Telecommunications Stakeholders have reacted to the Nigerian Communications Commission (NCC) agreement with Federal Inland Revenue Service on VAT Verification independent.
Recall that, Business Remarks earlier reported that NCC and FIRS signed an MoU on integration of an API technology solution with the telecom operators system for independent verification of the amount of VAT that should be paid by mobile network operators (MNO).
The telecommunications regulator said that diligence and appropriate due processes were undertaken to conclude the MoU, while taking its time to understand the importance of the MoU as a way to avoid double taxations.
“Our concern, as Regulator of the telecoms industry, is that we needed to be sure that it is not another way to tax telecoms Operators, who are already dealing with multiple taxation issues. We have also ensured that the integration of the solutions with telcos’ transactions systems will not, in any way, impact the cost and quality of service delivery by the Operators to telecoms consumers.” NCC highlighted.
Reacting to this, the Association of Licensed Operators of Nigeria (ALTON’s) President, Engr. Gbenga Adebayo said the modalities NCC will employ for the implementation is yet to be known.
According to him, “We haven’t receive details on how the commission intends to implement it. Until we know the details of what NCC has signed with the FIRS and how they intend to implement it, we cannot say.
However, Adebayo pointed out the areas of concern that need to be addressed.
“The issues we need to look at, are questions around the impact on the current structure, the implications to the subscribers as well as the system and the integrity on the network.
“Going forward, another thing to consider is the core implication on the operators and the subscribers. Until we know NCC’s position on this, we can’t say or do anything.” he stated.
More so, the President, Association of Telecommunications Companies of Nigeria (ATCON), Olusola Teniola noted that the activities of Over-the-Top (OTT) services has poised a major challenge to FIRS effective VAT verification in Nigerian telecommunications industry.
He posited that, “this appears to be the first step in attempting to verify VAT on voice and data services.
He said, “The reality is that the ability for revenue assurance and account separation adoption in the telecoms sector to provide a verifiable means of establishing the taxes due to and received by government as when due is becoming more complex.
“As the integration of OTT services into consumers daily usage patterns increases across broadcasting, voice, data and multimedia channels, this effectively puts a challenge on FIRS to independently rely on real time data that may not be located or generated in country.” he explained.
Teniola however further stated that the move to a digital economy will place a particular burden on FIRS to unravel the complex web underlying the Digital Economy.