Telecommunication Companies In Nigeria Propose 40% Tariff Increase

Telecommunication Companies In Nigeria Propose 40% Tariff Increase

Telecommunication operators under the auspices of Association of Licensed Telecommunication Operators of Nigeria (ALTON), have proposed a 40 per cent hike in call and SMS tariffs.

They operators said they decision was necessary considering the rising cost of business in the country, PUNCH reported Wednesday, citing a letter by ALTON to the Nigerian Communications Commission (NCC).

The letter said the fee for calls will increase from N6.4 to N8.95 while the price cap for SMS will increase from N4 to N5.61.

The association said the telecommunications industry had been financially challenged by an economic downturn that occurred during the COVID-19 pandemic in 2020 and the ongoing Russia-Ukraine war.

They noted that the war had resulted in a 35 per cent increase in their operating expenses due to an increase in energy costs.

ALTON added that the introduction of the five percent excise duty on telecom service providers has heightened the burden of multiple taxes and levies on the industry.

“ALTON considers it expedient for the telecommunications sector to undergo periodic cost adjustments through the commission’s intervention in order to minimise the impact of the challenging economic issues faced by our members,” it said.

“Upward review of the price determination for voice and data and SMS. Given the state of the economy and the circa 40 per cent increase in the cost of doing business, we wish to request for an interim administrative review of the mobile (voice) termination rate for voice; administrative data floor price, and cost of SMS as reflected in extant instruments.

“For data services, we wish to request that the commission implements the recommendations in the August 2020 KPMG report on the determination of cost-based pricing for wholesale and retail broadband service in Nigeria. Excerpts from the report are attached and marked ‘Annexure 2’ to provide a further illustration,” it added.

The spokespersons for the phone companies and the regulator, NCC, did not respond to calls and messages seeking comments.