The Federal Government of Nigeria has proposed a five per cent excise duty on telecommunications services, gaming, and betting activities. This is part of a new Bill to overhaul the Nigeria’s tax framework.
The Bill is entitled, “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,” was dated October 4, 2024.
An analysis of the proposed legislation on Friday showed that it seeks to introduce excise duties on various services provided in Nigeria. These include telecoms, gaming, gambling, lotteries, and betting.
A section 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. And in a manner as may be prescribed by the Service.”
A breakdown of the Excise Duty structure in the Bill indicates that telecoms services, including postpaid and prepaid services regulated by the Nigerian Communications Commission, will attract a five per cent duty.
The same rate will apply to gaming, gambling, betting, and lottery services.
The Bill also introduces guidelines on currency transactions. Specifying that any difference between the prevailing CBN, exchange rate and the actual transaction rate will be subject to tax.
“The new tax regime forms part of the Government’s strategy to boost non-oil revenue amidst fiscal pressures.
“With rapid growth in the telecoms and betting sectors, authorities are looking to widen the revenue base.
The Bill also aims to ensure that currency exchanges align with official CBN rates. With any excess payable as Excise Duty under a self-assessment model,” PUNCH reported.
source: PUNCH
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