Nigeria’s tax agency plans to generate tax from online gaming transactions using a platform run by a UK-based financial technology company.
The Federal Inland Revenue Service (FIRS) will use the Sentinal National Payment Gateway and Electronic Solution to improve tax collection from gaming companies, the executive chairman, Muhammad Nami, said in a statement on Wednesday.
The Sentinal national payment gateway is a transaction processing system that enables integrated payment services providers to deduct taxes at the points of transaction and immediately remit the tax deducted to the government’s treasury.
It provides governments with the ability to funnel all online transactions between end customers and e-commerce domestic and offshore merchants through one single payment portal.
“The FIRS is automating the administration of tax on online gaming using Sentinal National Payment Gateway and Electronic Solution,” Mr Nami said. “The deployment of Sentinal National Payment Gateway will simplify tax compliance for companies engaged in online gaming activities.”
The Nigerian government has faced revenue problems that have seen its budget deficit and debt rise. Nigeria’s debt stock increased to N42.84 trillion by June, according to the Debt Management Office (DMO). The government has explored options to expand its tax collection for more revenue.
The FIRS ordered all operators offering online gaming services in Nigeria to connect to the Sentinal system no later than December 31, 2022.
The notice said though it was not mandatory for online gaming operators offering online gaming services from outside Nigeria to be incorporated in Nigeria, they are compelled by tax laws to connect to the Sentinal National Payment Gateway for the purposes of dedicating tax from the gaming transactions of players in Nigeria, and remitting the same directly to the government purse.
David Kicks, the CEO of the E-Technologies Global Limited, thanked the Nigerian government for adopting his company’s tool. He said the system can drive a paradigm shift towards a point of consumption tax methodology.
“Governments in rapidly developing nations are struggling to keep pace with the evolution of eCommerce and the ascent of mobile transactions,” he said.
Among Nigeria’s numerous national challenges, which do you think the next president should focus on first?
— Premium Times (@PremiumTimesng) October 5, 2022
Support PREMIUM TIMES’ journalism of integrity and credibility
Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.
For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.
By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.
TEXT AD: Call Willie – +2348098788999