STAKEHOLDERS PICK HOLES IN NIGERIAN POSTAL COMMISSION BILL, IDENTIFY ANTI-COMPETITIVE CLAUSES THAT NEGATE BUSINESS GROWTH

responsible for the high rate of attrition in the industry.”

He argued that the proposal of an additional 2 per cent on revenue, would discount the fact that not all revenue becomes profitable and is collectible at the end of the financial year as some portion will be reported as bad and doubtful debts while some will be written off as bad debts.

“The desire to introduce another two per cent on revenue line, creates a cherry-pick scenario without identifying the realities of overheads and other cost lines before extracting a profit, if any, ”Ujam said.

He further said: “The company income tax averages 35 per cent on profit before tax and upon further analysis, two per cent on gross revenue in addition to annual licensing fees, will impact profit before tax by over 30 per cent, which technically amounts to double taxation. By implication the industry will be made less attractive to investors when compared with industries without this additional layer of tax, and dividends payable to investors will diminish.”

Addressing the potential impacts of the bill, Ujam said the exclusive powers and the additional two per cent contribution would further force consumers and businesses to use the Public Postal Operator, rather than express service companies, thereby damaging local businesses, and forcing local courier companies to close, thereby reducing foreign investment.

A senior management staff of NIPOST, who spoke in anonymity, told THISDAY that since the bill had passed the third reading at the floors of both the Senate and House of Reps, it would not be necessary to comment on it.