As part of a new plan to restructure Nigeria’s tax system, the federal government has proposed a five percent excise fee on gaming and betting operations, as well as telecom services.
The bill was obtained from the National Assembly on October 4, 2024, and was titled “A Bill for an Act to Repeal Certain Acts on Taxation and Consolidate the Legal Frameworks relating to Taxation and Enact the Nigeria Tax Act to Provide for Taxation of Income, Transactions, and Instruments, and Related Matters.”
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The aim of the new tax bill on telecom services, others
The goal of the new legislation, according to an examination of it on Friday, is to impose excise taxes on services like betting, lotteries, gaming, and telecoms that are offered in Nigeria.
A part of the bill read, “The amount of an excisable transaction is the amount chargeable for the service by the service provider, both in money or money’s worth.”
“Services, including telecommunications, gaming, gambling, betting, and lotteries however described, provided in Nigeria shall be charged with duties of excise at the rates specified under the Tenth Schedule to this Act in a manner as may be prescribed by the Service.”
According to a breakdown of the excise tax structure in the bill, telecom services, which include prepaid and postpaid services under the Nigerian Communications Commission’s regulation, will be subject to a five percent charge.
Lottery services, gaming, gambling, and betting will all be charged at the same rate.
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Tax bill on currency exchange rates
The bill stipulates that there will be an excise fee imposed on any difference between the current Central Bank of Nigeria exchange rate and the actual transaction rate, in addition to establishing requirements for currency transactions.
The introduction of the new tax system is part of the government’s strategy to boost non-oil revenue in light of the nation’s fiscal challenges .
The government is leveraging the rapid growth of the gambling and telecom sectors to boost its tax revenue.
Using a self-assessment technique, the law also aims to ensure that currency trades correspond to official CBN rates, with any discrepancy being paid as excise duty.
