Registration & Payment Of Tax As Conditionality For Lifting The Suspension on Twitter By Nigeria

0
136
DAVID ADONRI Managing Director HIGHCAP SECURITIES

A new twist has been introduced into the Twitter suspension saga by the Nigerian government. According to news now circulating in public space, government wants Twitter to register and pay tax as conditionality for it’s services to be accessed in Nigeria. Many people welcome this as tactic to convert adversity to prosperity.

Similar adversarial tactic was used by government to cajole MTN into listing on the defunct Nigerian Stock Exchange, in atonement for the company’s contravention of regulations. Through that action, the Capital Market was deepened and more Nigerians are now able to share in the wealth of MTN created in Nigeria.

There is no doubt that if all international virtual tech companies are compelled to incorporate in Nigeria, the benefits will be monumental. Imagine what Nigeria will gain if Twitter, Facebook, Instagram, LinkedIn, Yahoo, Amazon, Google, Netflix, EBay, U Tube and all cloud hosting domains have subsidiaries in Nigeria.

Such a dream is achievable only if non belligerent approach is adopted.  Through incentives and clever marketing outreaches, these prospective foreign investors can be attracted. Of course, world class engineering infrastructure and conducive sociopolitical environment will be added advantage.

Beside persuasive means, it is difficult to see how a hostile approach like the one deployed against Twitter can bring these world class virtual tech giants to Nigeria. Secondly, the issues around local registration and payment of tax before their services are allowed to be accessed in Nigeria are baseless.

Twitter and other foreign virtual tech companies are exporter of services which are imported and distributed by local carriers or ICT service providers like MTN, Globacom, Swift, 9 mobile, Airtel and numerous software vendors in Nigeria who leverage on those foreign virtual technologies. These Nigerian carriers pay tax.

It is inconceivable in international trade to compel a foreign exporter of goods or services to register and pay tax in countries where it’s goods or services are exported. It is the responsibility of the importer to pay import duty and other taxes for the goods or services imported.

In this case, it is the responsibility of the local internet service providers like MTN, Globacom, Swift, etc to pay local taxes for the services they import. If exporters are to register and pay taxes in all countries they export to, it means NNPC, Dangote and all other exporters of goods and services from Nigeria must register and pay tax in all the countries they export to. We all know that this is not the case. World Trade Organization (WTO) has already ironed out these issues.

Consequently, any contemplation by Nigerian government to force Twitter and the likes, to register and pay tax in Nigeria before their services can be accessed, is an exercise in futility. The MTN treatment cannot work in this case.

DAVID ADONRI HIGHCAP

- Advertisement -

Firstbank