A person holds a new 1000 Naira note as the Central Bank of Nigeria releases the notes to the public through the banks in Abuja
IBTimes NG

Nigerian telecommunications companies have proposed a 100% increase in their tariffs, which is waiting for government approval, as per MTN Nigeria's CEO Karl Toriola.

Toriola explained that the proposed tariff increase is essential for the sustainability of the telecommunications industry, which has been struggling with rising operational costs.

He mentioned that they have requested a 100% tariff hike, but doubts it will be approved at that level due to the sensitivity of the current economic situation in the country, Punch reported.

Despite these challenges, Toriola remains hopeful that regulators will make the right decision, considering the industry's current circumstances. The proposal, submitted to the Nigerian Communications Commission, aims to cover rising operational costs, such as inflation and higher service delivery expenses.

However, the CEO mentioned that it is still uncertain whether the Nigerian Communications Commission, the telecom regulator, will approve the proposal.

He expressed that policymakers, regulators, and the industry, including ALTON Chairman Gbenga Adebayo, are united in their concerns about key issues. He highlighted that human rights are vital for driving any economy, and without a sustainable telecom industry, the broader economy and people's well-being will suffer.

The proposal comes as telecom companies face rising costs due to inflation, exchange rate changes, and higher prices for key operational needs like diesel, power, and raw materials.

Telecom operators warned that without a tariff increase, service disruptions are likely due to rising operational costs. ALTON Chairman Gbenga Adebayo described the sector as "under siege" and said that operators may need to reduce services without an adjustment, limiting access in some areas.

The request for a tariff change was made in April 2024, but no progress has been made. ALTON and ATCON urged the Federal Government to facilitate discussions to balance affordability for consumers with the financial health of telecom operators, stressing the need for action to secure the future of Nigeria's telecom industry.

In 2023, President Bola Tinubu signed four executive orders, including the removal of the five percent excise tax on telecommunication services and the excise duties escalation on locally manufactured products. He also signed another executive order that suspended the Finance Act 2023 deferring the date of its commencement from May 28 to Sept. 1 that year.