This year is expected to witness the much awaited deployment of the fifth generation (5G) technology. Meta has put small businesses that use its various channels to advertise to brace for the payment of 7.5per cent VAT, while cybercrimes may continue if the crushing poverty and youth unemployment ravaging the country are not addressed, writes LUCAS AJANAKU.
The deployment of the fifth generation technology (5G) early this year is expected to dominate the information communication technology (ICT) space.
The Minister of Communications and Digital Economy, Prof Isa Pantami, had given assurance about early deployment of the technology during the fourth quarter (Q4) last year.
Preparatory to the deployment, the National Frequency Management Council (NFMC) chaired by Pantami had approved the release of 3.5gigahertz (GHz) spectrum for the deployment of the technology. After a successful mock auction, the final bid round to auction the spectrum was conducted at Transcorp Hotel, Abuja.
Three firms competed: MTN Nigeria, Airtel Nigeria and Mafab Communications Ltd.
After 11 rounds of bidding that lasted for about eight hours, Mafab Communications Ltd and MTN Nigeria Plc, emerged winners of the spectrum auction.
The three companies had qualified for the auction, having met the requirements stipulated in the Information Memorandum (IM) for the spectrum auction. They had also participated in a mock auction preparatory to the real auction.
In the first Round of the auction, the bid price was fixed at $199,374,000.00; $201,367,740.00 at second Round; $204,388,356.10 at third Round; $209,407,962.50 at fourth Round and $215,782,901.30 at the fifth Round.
The auction prices increased progressively to $224,414,217.43 at the Sixth Round; $231,146,643.96 at the seventh Round; $240, 392,509.71 at the eighth Round; $251, 210,172.65 at the ninth Round; and $263,700,050.00 at the Round 10 of the auction exercise.
The auction process attained its peak at Round 11 when the bid price graduated to $275,904,886.25 with all the three bidders still actively participating. The Main Stage of the Auction, however, ended at the conclusion of the 11th Round, with Airtel listing an exit bid of $270,000,000, while MTN posted an exit bid of $273,000,000, giving way to the Assignment Stage. At this point, Airtel had dropped off from the race having posted a lower exit bid, thus leaving Mafab and MTN as winners of the two available lots.
The Executive Vice Chairman of NCC, Prof Garba Danbatta, expressed satisfaction that the auction process was efficient, fair, credible, well-organised and transparent and was designed to deliver the ideal outcome.
Twitter ban
This year, the Federal Government is expected to lift the indefinite suspension slammed on Twitter, a microblogging social site, last year. The ban was imposed on the platform when it pulled down a tweet by President Muhammadu Buhari threatening to speak to secessionist group with the language they understand.
The ban has continued to cost the country huge cash running into several billions of naira since it came into effect on June 4, 2021. Minister of State for Labour and Employment, Festus Keyamo, had said the dialogue to lift the ban on Twitter was in progress with few conditions yet to be met.
The government had assured that the ban would be lifted “just a few more days” in September but was never to be till the year ended. He said Twitter has agreed to all the government’s conditions but singled out “timelines” as the only hiccup.
“It was Twitter, just to put it in context, that reached out to the Federal Government to say they want to know what they can do to straighten up the relationship with the Federal Government. And so we’ve gone far. What is left now are the timelines to fulfill those conditions.
“Once those timelines come and they fulfill those conditions, Twitter will be back to business in Nigeria. They know exactly what we want. And these are things that are extremely altruistic,” Mr Keyamo had said.
He said the social media giant has agreed to pay taxes to the government as well as set up a physical office in Nigeria where users can take their complaints to. Twitter had earlier stirred a debate in Nigeria when it announced its decision to set up its regional headquarters in Ghana rather than Nigeria where it enjoys more patronage.
It cited “free speech, online freedom, and open internet” among its reasons, something that irked government officials.
“So, they’ve agreed to taxation, they’ve agreed to open an office in Nigeria so that there can be some, you know, face to face complaints so that we don’t have to be going through algorithms to complain about activities of certain persons who use Twitter to subvert the government of the day.
“There are certain lines that people should not cross when sending out messages, or tweeting things that are capable of tearing us apart. For instance, things are not capable of setting this country on fire, you know, but to use those platforms to promote and propagate some of these ideas,” Mr Keyamo had said.
The directive was promptly carried out by the telecommunication companies the next day, following a formal instruction from the NCC to that effect. NetBlocks Cost of Shutdown Tool estimates that Nigeria’s economy loses N104.02million ($250,600) every hour to the Twitter ban.
Twitter, Facebook, Google, others to pay tax
The Senate has passed the Finance Bill 2021, transmitted to the National Assembly by President Buhari, on December 7, 2021. The passage of the bill followed the consideration of a report by the Senate Joint Committee on Finance; Customs, Excise and Tariff; Trade and Investment.
One of the major highlights of the Bill is the aspect empowering the Federal Inland Revenues Service (FIRS) to assess non-resident firms such as Twitter, Facebook, Google, and Netflix, among others. They are to be taxed on fair and reasonable turnover earned from digital services to Nigerian customers. The Finance Bill further mandates FIRS to appoint persons for the purpose of collection and remittance of non-resident taxes.
Chairman of the Joint Committee, Senator Solomon Adeola, said the Bill sought to support the implementation of the 2022 Federal Budget of Economic Growth and Sustainability by proposing key specific taxation, such as Customs Duties, fiscal charges and other relevant laws.
He said a total of 12 Acts were amended under the Finance Bill which contained 39 clauses.
He said the Bill sought to promote fiscal equity, align domestic tax laws with global best practices, introduce tax incentives for infrastructure and the capital market and support small businesses with a view to increasing government’s revenue.
“The Finance Act 2020 was predicated essentially on having no new taxes and no new incentives due to the COVID-19 impact on the economy, as such, it was structured across four broad thematic areas; Enacting counter cyclical measures and crisis intervention initiatives; Tax, fiscal responsibility and public procurement reforms; Reforming fiscal incentives policies for job creation; ensuring closer coordination of monetary, trade and fiscal policies and Enhancing tax administration,” Adeola had said.
The committee based on its observations, recommended five per cent Capital Gains Tax to be imposed on shares’ disposal transactions where gains exceed N250 million in 12 months. It recommended that Gaming and Lottery companies be taxable, as it applies to oil and gas companies.
The Bill underscored the need for midstream and downstream oil and gas companies to be liable to corporate tax, without the benefit of tax exemptions for firms exporting goods to earn foreign exchange.
The Bill equally sought more powers for the Federal Inland Revenue Service (FIRS) to collect the Nigeria Police Trust Fund (NPTF) levies on Nigerian companies and to streamline tax, levy collection from Nigerian companies in line with the administration’s ease of doing business reforms. The Bill further empowered FIRS to assess and tax non-resident firms on fair and reasonable turnover basis on revenue earned from digital services to Nigerian customers, with a further mandate to appoint persons for the purpose of collection and remittance of non- resident taxes.
The committee sought reforms on securities lending transactions, minimum tax for insurance companies and companies in general, taxation of unit trust income, real estate investment trust, and insurance companies capitali sation by National Insurance Commission (NAICOM in line with tax equity.
It advised the government to mandate FIRS as principal tax revenue collection agency, to collaborate with law enforcement agencies and ministries, department and agencies (MDAs) in streamlining tax collections by enhancing public financial management reforms.
According to the joint committee, doing so would reduce revenue leakages and better track actual expenditure to revenue performance in line with the provision of the 1999 Constitution of the Federal Republic of Nigeria (as Amended), Fiscal Rules and other Extant Money Acts.
The committee demanded an increase of 0.5 per cent in education tax, pushed for close monitoring of unfolding development and policies on VAT, tax incentives, projected increase tariff on tobacco, alcohol and carbonated drinks to fund vital expenditure on health, education and security, with the possibility of introduction of new taxes, tariffs and levies as the economy recovers. (Nation)