• Thursday, June 13, 2024
businessday logo


Telecom blackout looms in Kogi, Abuja, others over taxes

Why telecom market attracts low capital imports in recent years

The decision of the Kogi State government to increase the collection of Internally Generated Revenue (IGR) and sealing of base tower stations in the state could lead to a total telecom blackout that would affect other neighbouring states.

Telecom operators under the aegis of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), in a statement, said the actions followed an ex-parte court order obtained by the Kogi Inland Revenue Service (KIRS) over unsubstantiated allegations that ALTON members are in default of tax payments to the state government and access to these critical telecom sites has been denied.

“As a result of these actions by the state government, our members are unable to refuel power generators in these sites, a situation which has led to outage of over 70 sites, including hub sites across parts of Kogi State,” ALTON noted in the statement signed by Gbenga Adebayo, Chairman of the association, and Gbolahan Awonuga, Chairman, Head of Operations.

Apart from Kogi, the blackout is projected to affect parts of Abuja, some parts of Nasarawa, Benue, Enugu, Anambra, Edo, Ondo, Ekiti, Kwara, and Niger States.

Read also:  Telcos sink under burden of multiple taxes

Established in 1991, Kogi state occupies 29,833 square kilometers. It has 21 local government areas (thirteen local government areas from the former Kwara and eight from Benue States). According to a report by the National Bureau of Statistics (NBS), Kogi State by the end of 2021 had only 3.7 million voice subscribers and 2.8 million internet subscribers. The state also hosts less than 1000 base stations.

A shutdown of telecommunication services in Kogi State not only compounds the woes in the sector but also widens the digital divide in the country. The telecom industry saw the least capital importation in over 10 years in 2021 according to a new report by the NBS. Beyond indiscriminate taxes, telecom operators are also struggling to keep their operations running in the face of fuel scarcity.

According to an expert, more telecom masts are down than usual causing poorer network service in many places. The lack of electricity supply means that many of the masts are starting to show signs of being overworked. The poor network service is affecting financial services and payment channels such as ATMs and PoS transactions.

A shutdown of telecom operations in Kogi would be more misery for states like Niger which was also affected by the telecom shutdown in 2021 which was ordered by the military as a measure to fight insecurity in the region.