The Federal Government has quietly reversed a toxic levy. This levy had threatened to add fresh strain to already squeezed household budgets.
President Bola Ahmed Tinubu ordered the removal of the 5 per cent excise duty on telecommunications services. This includes voice calls and data subscriptions. The National Orientation Agency on X confirmed this move. The Nigerian Communications Commission also confirmed it.
This is a political and economic U-turn with consequences. The excise duty was first floated under the Muhammadu Buhari administration in 2022. It was partly implemented amid a push to broaden the non-oil revenue base.
The idea provoked near-instant resistance from operators and consumer advocates. They warned it would choke access to essential digital services. It would also slow investment into networks.
Why this matters now. Nigeria still depends on mobile networks for social and economic life. The NCC recently reported roughly 171 million active telecom subscriptions.
This figure shows how many Nigerians would have been affected by the levy. They would be affected either directly through higher bills or indirectly through slower investment in coverage and service quality.
Any tax on voice and data is not a niche technicality. It is a levy on access to information, jobs and commerce.
What the public and industry said. Dr Aminu Maida, the NCC’s Executive Vice Chairman, spoke to journalists. He stated that President Tinubu personally intervened during discussions on the Finance Act.
He intervened to remove the duty. The move was described as necessary to avoid extra financial strain on citizens. It was also important to protect the digital economy.
Industry bodies had earlier warned the cumulative tax burden on telecoms was already punishing. ALTON and others cited scores of overlapping charges, arguing further levies would be counterproductive to growth.
A closer, sceptical read. Removing the 5 per cent levy is politically popular and instantly relief-oriented. But it also exposes several uncomfortable truths.
First, the Finance Act debate shows how ad hoc Nigeria’s tax policy has become. The policy includes last-minute reversals. These reversals surprise investors and complicate fiscal planning.
Second, the government has to find other revenue sources to plug fiscal gaps. The original justification for the excise duty was straightforward. With oil receipts unreliable, authorities sought to expand the tax net. The reversal transfers the pressure back to other parts of the budget or to future reforms.
The cost and the gain. For the average mobile user the immediate gain is obvious fewer naira out of monthly data bundles and call spend. For operators the news removes a regulatory overhang and ease arguments against price reductions.
Operators still face high operating costs. They experience foreign exchange pressures and multiple levies. Analysts say these factors amount to a heavy effective tax load.
If the government truly wants cheaper, faster, more reliable services, it must go beyond scrapping this single levy. It needs to create a predictable, investment-friendly fiscal framework for digital infrastructure.
Timeline For Context
• In 2022, a 5% excise duty was proposed and partly enacted. This occurred under the Buhari era as part of wider revenue reforms.
• September 2022 Suspension and industry pushback that followed as stakeholders argued the levy would hurt consumers and investment.
• 2023–2025 Period of uncertainty with the tax intermittently discussed in Finance Act negotiations and public debate.
• 11 September 2025 President Tinubu formally orders removal of the 5% telecom excise duty, announced via NOA and NCC.
Questions Authorities Must Answer Now
• What compensatory revenue measures will be adopted to replace expected receipts from the levy
• Will the reversal be written into law to prevent future sudden reimposition
• How will the administration tackle the wider problem of overlapping taxes that industry says number in the dozens
This reversal is a relief for subscribers. It does not cure the deeper policy confusion. This confusion has reversed investor confidence for years. It has also given Nigerians cause to fear the next surprise charge.
Till the fiscal architecture for the digital economy is stabilised, each announcement will bring temporary cheers. Nonetheless, it will leave unresolved the structural choice. The dilemma is between short term revenue raising and long term digital inclusion.
What do you think? Should the government lock this reversal into statute? Or is a flexible approach to taxes better for Nigeria now?
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