Nigerian govt to impose 5% VAT on online betting, gaming, others

Apr 09, 2019

The Federal Government on Monday announced the introduction of Value Added Tax (VAT) on lottery and gaming activities and automate collection from operators in the Lottery sector.

This was disclosed by the Chairman of the Federal Inland Revenue Service (FIRS) Babatunde Fowler at a stakeholders’ engagement session with lottery and gaming operators in Lagos.

Fowler explained that the 5 per cent VAT was not a tax to be borne by operators, but their customers

Fowler said. “Tax has to do with law and the law says that for every transaction that is VATable, 5 per cent should be charged. You have to be aware that we are automating collection in all industries.

‘’This is not a tax on the business, but on a bettor who hopes to win. You also have to realize that 85 per cent of VAT goes to the state, which is supposed to be closer to us. In this case, we are all winners,” Fowler said.

According to him, the bill is then settled through the online platform, as the software allows operators to file VAT returns and is flexible enough to accommodate disputation over the figures, which operators can resolve with the FIRS through the provision of documents to back such claims.

Speaking on behalf of lottery and gaming operators, Mr Akin Alabi, founder of Nairabet, argued that the FIRS should have consulted operators before taking the decision to impose 5 per cent VAT and the automation of collection.

Reacting, Fowler said ‘’This is not a tax on the business, but on a bettor who hopes to win. You also have to realize that 85 per cent of VAT goes to the state, which is supposed to be closer to us. In this case, we are all winners.’’

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