Nigeria, has announced that it is implementing the proposed 5% tax on voice calls, mobile data and text messages, seeking to tackle a mounting fiscal crisis.
The tax is in addition to a 7.5% value-added tax (VAT) on calls and data.
However, the government did not disclose when collections of the tax will begin.
Nigeria’s finance minister Zainab Ahmed announced the implementation of the mobile services tax, highlighting the government’s strained financial picture. As of April, the country spends more on debt servicing than it brings in revenue
A similar tax introduced by West African neighbour Ghana was blamed for a slowdown in mobile-money revenue by MTN Ghana in its first half results. Ghana, also facing a fiscal crisis, introduced a 1.5% e-levy in May to boost government revenue and reduce its burgeoning budget deficit.
Cameroon, Kenya, Tanzania, Uganda and Zimbabwe have all introduced taxes that target mobile money payments.
In Tanzania, which imposed a mobile money tax in July 2021, peer-to-peer transactions fell by 38% from 30 million to 18 million per month, a study by GSMA found.