The federal government has introduced a new
telecommunications tax to provide finance to subsidise the cost of provision of
health care services to vulnerable persons in Nigeria.
This is contained in the National Health Insurance Authority
Bill 2021 signed into law by President Muhammadu Buhari on May 19.
Section 26(1c) of the act states that the source of money
for the Vulnerable Group Fund includes “telecommunications tax, not less than
one kobo per second of GSM calls”.
The law defines the vulnerable group as children under five,
pregnant women, the aged, physically and mentally challenged persons, and the
indigent “as may be defined from time to time”.
It specified that the money from the vulnerable group fund
shall be expended to provide subsidy for health insurance coverage of
vulnerable persons as determined by the council; and for the payment of health
insurance premiums for the indigent.
Thus, to fund it, the law provides several options such as
basic health care provision fund to the authority; health insurance levy;
telecommunications tax, not less than one kobo per second of GSM calls; money
that may be allocated to the Vulnerable Group Fund by the government; motley
that accrues to the Vulnerable Group Fund from investments made by the council:
and grants, donations, gifts, and any other voluntary contributions made to the
Vulnerable Group Fund.
The National Health Insurance Authority Act further mandated
all persons resident in Nigeria to obtain health insurance.
Speaking on the development via his Twitter handle, Taiwo
Oyedele, fiscal policy partner and Africa tax leader at PwC, said the new
telcommuncations tax is equivalent to a 9 percent tax on GSM calls since call
rates are charged at 11 kobo per second.
“S.26 of this new law imposes a telecommunications tax of
not less than 1kobo per second on GSM calls. With call rates at about 11kobo
per second, this translates to a 9% tax on GSM calls,” his tweet reads in part.
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