AT A GLANCE: 50% telecom tariff hike, 15% port charges… levies adjusted, introduced under Tinubu’s administration

In almost two years, four different tariffs have been reviewed upwards and one introduced under President Bola Tinubu’s administration.

As a result, businesses and households are grappling with poor economic conditions as Tinubu’s administration approaches its second anniversary.

While the decisions were made to increase the revenue of companies and government agencies in the face of the rising operational costs driven by Tinubu’s economic reforms, they are worsening the financial burden on Nigerians, as the cost of living rises and purchasing power drops.

TheCable highlights tariffs adjusted and introduced under Tinubu’s administration.

ELECTRICITY TARIFF ADJUSTMENT

On April 3, 2024, the Nigerian Electricity Regulatory Commission (NERC) announced the approval of an increase in electricity tariff for customers under the Band A classification.

Musliu Oseni, NERC vice-chairman, said starting from April 3, customers under the classification, who receive 20 hours of electricity supply daily, will pay N225 per kilowatt (kW) — up from N66.

The adjustment was to reduce the amount the federal government spends on subsidising electricity.

The NERC said the approved tariff would reduce electricity subsidy for the 2024 fiscal year by about N1.14 trillion.

The federal government said it aims to gradually phase out electricity subsidies.

50% INCREASE IN CALL AND DATA COSTS 

Three weeks into January, the Nigerian Communications Commission (NCC) approved the request of telecommunications companies (telcos) to increase tariffs.

The approval is the first hike since 2013.

NCC said the tariff adjustment is capped at 50 percent, below the 100 percent requested by the telcos.

A few days after the approval, Wale Edun, the minister of finance and the coordinating minister of the economy, said the tariff in the telecommunications sector will be reviewed periodically.

Edun said the tariff adjustment was essential for sustaining the sector amid rising operational costs and inflation.

The move sparked several reactions, including the Nigeria Labour Congress (NLC) criticising the federal government for approving the increase.

NLC described the decision as a “clear assault” on Nigerian workers’ welfare.

On February 11, the house of representatives asked the ministry of communications, innovation and digital economy to suspend the approval granted to telecommunications companies (telcos) to increase tariffs by 50 percent.

However, MTN Nigeria has set new data prices, by increasing its 15 gigabytes (GB) weekly data plan from N2,000 to N6,000.

ATM TRANSACTION FEE HIKE

In a move to generate more revenue from the financial sector, the Central Bank of Nigeria (CBN) has reviewed the transaction fees for automated teller machines (ATMs).

CBN said the move, aimed at addressing the rise in operational costs and enhancing efficiency in the banking sector, will take effect from March 1.

According to the new policy, customers withdrawing from their bank’s ATMs at the financial institution’s branch, at the mall or in other public places will not be charged.

However, an N100 fee per N20,000 withdrawal will be applied when ATMs located at other banks’ branches are used by non-customers.

For withdrawals at ATMs of other banks (not-on-us transactions) at the mall or in other public places, an N100 fee plus a surcharge of up to N500 per N20,000 withdrawal will be charged.

15% PORTS CHARGES

For the first time in 32 years, the Nigerian Ports Authority (NPA) implemented an upward review of port tariffs – a move that will significantly affect importers and exporters.

Citing the hike in inflation, Abubakar Dantsoho, the NPA managing director, said the tariff review would fund the deployment of information communications technology (ICT) infrastructure necessary for the port community system (PCS) and national single window (NSW).

However, the Manufacturers Association of Nigeria (MAN) criticised the review, saying businesses are already struggling with the rising cost of operations, high rate of foreign exchange (FX) and other general economic uncertainties.

CUSTOMS 4% FOB CHARGES

The Nigeria Customs Service (NCS), on February 5, announced plans to implement a 4 percent charge on the free-on-board (FOB) value of imports.

However, the Lagos Chamber of Commerce and Industry (LCCI) urged the federal government to suspend the implementation, saying that businesses were not given prior notice or the opportunity to prepare for the financial burden.

Bukola Saraki, former senate president, had also raised concerns over the implementation, warning that it would place undue burden on businesses and consumers.

In response to the outcry, customs suspended the implementation of the 4 percent FOB charge on February 11.

According to NCS, the move followed ongoing consultations with Wale Edun, the minister of finance and coordinating minister of the economy.