ATCON POSITION PAPER ON THE PROPOSED COMPLIANCE WITH THE CYBERSCRIME ACT 2015 – COLLECTION AND REMITTANCE OF LEVY FOR NATIONAL CYBERCRIME FUND

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The Association of Telecommunications Companies of Nigeria (ATCON) is not happy with a recent directive by the Central Bank of Nigeria (CBN) to all banks on the collection of 0.005% levy on all electronic transactions into a National Cyber Security Fund account within the CBN which is expected to affect some businesses.

The businesses which are to be affected are as follows; GSM Service Providers and all telecommunication companies; Internet service providers; Banks and other financial institutions; Insurance companies and Nigerian stock exchange

The eventual implementation of this levy of 0.005% would cripple if not render useless government and private sector efforts to speed up the broadband penetration in Nigeria and our Association has a mandate to protect the investment in the telecom industry from undue pressure from the government in the form of yet additional burden on our members that are already overtaxed by all tiers of governments.

Introduction

The Association of Telecommunications Companies of Nigeria (ATCON) is a professional, non-profit, non-political umbrella organization of telecommunications companies of Nigeria. It is also the premier Association that was formed by technocrats in the telecoms industry to facilitate as well as accelerate the growth and adoption of broadband for the purpose of socio-economic development of Nigeria so that our country would not be left behind in terms of 21st century innovation.

ATCON was formally inaugurated on December 10, 1993, with a membership profile made up of indigenous and multinational telecommunications companies operating in Nigeria. Membership of the Association has since its inauguration grown to over 100 companies.

The Association holds meetings with government at all levels with the sole aim of influencing government policy in order to create an enabling operating environment for members as well as to protect telecoms/ICT investment in Nigeria.

Underlining reasons for our Position

The Cybercrime (Prohibition, Prevention, Etc) Act 2015, Section 44 that the CBN seeks to implement, states in Section 44 an establishment of a National Cyber Security Fund. In Section 44.2 (a) a Levy of 0.005 of all electronic transactions by the businesses specified in the second schedule to this Act. Where in the Schedule five categories including GSM Service providers and all telecommunication companies and Internet Service Providers are to apply this charge!

ATCON believes any premeditated actions that are capable of killing the telecoms industry must be eschewed by all tiers of governments in Nigeria as the perceived benefits of imposing this levy on aforementioned businesses have the direct capability to erase if not destroy the achievements that have been made since the telecoms sector was liberated. We therefore advise government review this directive as it would affect some macro-economic elements such as loss of employment and we as Industry will have to increase prices to cover the collection, processing and pass on these costs to the 150million subscribers.

Inconsistent and defective policy formulation

Our Association is of the opinion that formulation and implementation of policies are not properly coordinated in the sense that while some government agencies are working towards migrating all government services online some other government agencies are working towards discouraging people from making use of electronic channels via this obnoxious levy. It should be stated for the purpose of records that government should not think that the elasticity of demand for the use of electronic channels is inelastic as this move can stop people from transacting their businesses via available electronic channels.

ATCON Invitation to meet CBN

Our Association has requested repeatedly to meet with Mr Godwin Emefiele, Governor of CBN to discuss some of the issues that our members are facing with respect to sourcing for foreign exchange to purchase the needed equipment and to our great surprise the central bank of Nigeria has not honoured the invitation.

 

Conclusion

ATCON believes any actions that has the potential to destroy the telecoms industry should be avoided by all tiers of government in Nigeria as the accruable benefits of imposing this levy on our members are far lower than the revenue that it is going to create for the government. In view of this and other reasons enumerated above, the Association’s position is that the proposed levy of 0.005% tax bill should be withdrawn and its implementation seriously reviewed.

Olusola Teniola

National President

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