The West Africa Telecommunications Regulators Assembly (WATRA) has said reduction in taxes, charges and tariffs will drive down the cost of production and boost investments in the country’s telecom sector.
WATRA’s Executive Secretary, Aliyu Yusuf Aboki, who disclosed this in an exclusive interview with Daily Trust, added that the federal and state governments should reduce the financial burden on the telecom sector in order to enhance its ability to drive economic growth.
“Increasing taxes is not the way to go. On the contrary, lowering taxes makes the sector more appealing to foreign investors which can lead to higher economic growth. Even though there is a potential for the sector to bring in revenue through taxes, there is a bigger potential if you allow the sector to thrive through lowering taxes as there will be more room for investments.
“Studies have shown that countries with lower taxes have higher levels of GDP per capita and increased employment rates. There are proven cases that if we keep our taxes down, we should see an improvement in our GDP because this will enable more activity. Overall, reducing taxes and tariffs is an effective way to promote economic growth and job creation,” he said.
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He said the government should also reduce costs for operators in the sector, arguing that this will spur more investment in infrastructure while reducing the cost of services for consumers.
The telecom sector in Nigeria is said to be worth about $75 billion in terms of investment.
Telecom operators have been able to connect over 320 million lines out of which about 220 million are active. Some of the operators have also paid about N4 trillion in taxes since the GSM revolution began in Nigeria more than 20 years ago.