Font size:
Print
The Nigerian Communications Commission (NCC) is set to amend its regulation on the payment of Annual Operating Levy (AOL) by its licensees. Already, the Commission has drafted the amended regulation, while a notice has been issued to all operators to make their inputs before the final draft. According to the notice issued by the regulator to all its licensees, a public inquiry on the amended regulation is to be held virtually next month. The draft amended regulation, a copy of which was sighted by our correspondent, shows that the regulator maintains the status quo with the percentage of the operators’ revenue to be paid annually.
It, however, states the deductions to be made before the 2.5 per cent AOL is calculated. “Every licensee that is a network operator shall pay to the commission an annual operating levy assessed at two and a half percent of the Licensee’s Net Revenue for the relevant period being its gross revenue less its roaming cost, interconnect cost, and Value-Added Services payable to VAS providers for the period. For the holders of internet service provider licence, only bandwidth cost is allowed to be deducted from gross revenue to arrive at the net revenue for the relevant period,” the Commission stated in the amended regulation. While classifying the operators into Network and Non-network Licences, the commission states that the Non-Network Operator are to pay an Annual Operating Levy of one per cent of their net revenue for the relevant period, “being their gross Revenue less their roaming, interconnect and bandwidth costs for the period. “The portion of the revenue generated from the value-added services payable to Value Added Service providers shall be considered as an allowable deduction from the gross revenue of the network operators. “The portion of revenue shall be fully disclosed in the network operator’s audited accounts.
The operators should also provide the commission with details of the revenue every quarter showing amount payable to each VAS licensee for the period,” NCC stated in the regulation. Meanwhile, the Association of Licensed Telecommunications Operators of Nigeria (ALTON) had recently called for a downward review of AOL. The Chairman of ALTON, Gbenga Adebayo, who made the call at a telecoms forum in Lagos, said a downward review of AOL became imperative as the increasing usage of Over- The-Top (OTT) services by telecommunications customers were adversely impacting on revenue of the operators.
He said that the operating levy of 2.5 per cent should be reduced to one per cent, in the face of the reality on the ground in the industry. According to him, the 2.5 per cent is being deducted from the operator’s turnover, which he described as not fair enough. ”For example, let me say you sell N1 million, then you remove your expenses, you remove your tax, then you take your profit from it. ”What NCC does is to take the entire turnover, that is all income before tax and before expenses, then take 2.5 per cent on it, which in itself is not a fair approach. ”This is because for you to achieve this N1 million, you have spent certain money, so, I feel you should take out your expenses before they apply the 2.5 per cent. So, what it then means is that the 2.5 per cent is actually additional expenses on the operators. It is high because it is 2.5 per cent of annual turnover, not 2.5 per cent of profits. They need to consider a downward review, one per cent will be fair,” he said.newtelegragh
