Revised News: Despite Nigeria's decision to abandon the proposed increase in telecommunications taxes in July 2023, the taxation framework for the sector remains operationally intricate, according to BMI, a subsidiary of Fitch Solutions. This complexity has made it challenging for operators seeking to modernize Nigeria's digital infrastructure, with concerns raised about the various rules in place across states and the imposition of 46 separate taxes on market operators. To address this challenge, operators have considered the possibility of departing from the existing nationwide tariff structure and adjusting retail prices for calls, data, and SMS services based on the user's location. However, such price adjustments, combined with high inflation, may impact consumer confidence and create unease among the public and in the sector. It's worth noting that Fitch had previously highlighted the positive implications of abandoning additional tax regimes on telecom regulators in July 2023. Nevertheless, the taxation system for the sector remains complex and varied across states. In November 2019, the Nigerian government launched the National Digital Economy Policy and Strategy (2020-2030) to promote digital technologies and reduce dependence on the oil and gas sector. While Nigeria scores higher than the regional average in the Sub-Saharan Africa Telecommunications Industry Risk Index, challenges remain, including high spectrum prices that have added to operators' debt burdens. Fitch acknowledged that taxation is a concern for operators but emphasized that the market still offers potential rewards, particularly due to the growing youth population interested in premium data and mobile banking services, which contribute significantly to operator revenues. The report also noted that the rising cost of living in Nigeria could lead to economic protests and strikes in the second half of 2023. While the government may introduce support measures to address high inflation, it is unlikely to reinstate the fuel subsidy. The report suggested that the administration might consider streamlining tax administration and processes, but its impact on the telecom sector, a major source of income for the treasury, remains uncertain. Fitch cautioned that price hikes could contribute to public unrest, as observed in Burkina Faso and other parts of Sub-Saharan Africa.