Nigeria Proposes 5% Excise Duty on Telecoms, Gaming, and Betting
The Nigerian government has introduced a new bill that could significantly impact the nation’s tax framework. The proposed legislation, which aims to overhaul the current taxation system, includes a 5% excise duty on telecommunications services, gaming, and betting activities.
The bill, which was obtained from the National Assembly, seeks to introduce excise duties on various services provided in Nigeria, including telecoms, gaming, gambling, lotteries, and betting. According to the bill, the amount of an excisable transaction will be the amount charged by the service provider, either in money or money’s worth.
A closer look at the proposed excise duty structure reveals that telecoms services, including postpaid and prepaid services regulated by the Nigerian Communications Commission, will attract a 5% duty. The same rate will apply to gaming, gambling, betting, and lottery services.
In addition to the excise duty on these services, the bill also introduces guidelines on currency transactions. Any difference between the prevailing Central Bank of Nigeria exchange rate and the actual transaction rate will be subject to excise duty. This move is aimed at ensuring that currency exchanges align with official CBN rates, with any excess payable as excise duty under a self-assessment model.
The proposed tax regime forms part of the government’s strategy to boost non-oil revenue amid fiscal pressures. With the rapid growth in the telecoms and betting sectors, authorities are looking to widen the revenue base and capitalize on the potential of these industries.
If implemented, the new tax regime could have significant implications for businesses and individuals operating in these sectors. While the government’s efforts to boost revenue are understandable, it remains to be seen how the proposed excise duty will affect the growth and development of these industries in Nigeria.
The proposed bill is set to overhaul Nigeria’s tax framework and introduce new guidelines on taxation. As the bill makes its way through the National Assembly, stakeholders will be watching closely to see how it will affect the economy and the business community.
