- Advertisement -

Direct Tax Collection From Online Gaming Commenced by FIRS

Posted by

The Federal Inland Revenue Service (FIRS), Nigeria’s tax agency, will start directly deducting and collecting taxes from online gaming enterprises at transaction points using the Sentinal National Payment Gateway and Electronic Solution.

- Advertisement -

The Executive Chairman of the FIRS’s Special Assistant on Media & Communication, Johannes Oluwatobi Wojuola, provided this information to the media on Wednesday in a statement.

According to the statement, Muhammad Nami, the Executive Chairman of the Service, explained that 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, while directing full compliance by the online gaming community.

- Advertisement -

The notice stated: “The FIRS is adopting Sentinal National Payment Gateway and Electronic Solution to automate the administration of tax on online gambling.

Sentinel National Payment Gateway is a method for processing transactions that enables Integrated Payment Service Providers to withhold taxes at transaction-points and remit the withheld taxes to the government’s treasury.

- Advertisement -

Sentinal National Payment Gateway implementation will make it easier for businesses involved in online gambling to comply with tax laws.

The Service further stated that by December 31, 2022, all operators providing online gaming services in Nigeria must “link to the Sentinal National Payment Gateway, deduct tax on online gaming transactions, and send same directly to the relevant government’s treasury.”

The notice further stated that, even though it was not required, existing tax laws required online gaming companies providing services from outside Nigeria to connect to the Sentinal National Payment Gateway in order to deduct tax from players’ gaming transactions in Nigeria and remit that tax directly to the government coffers.

When addressing this method of tax collection at the point of sale, Nami added that Nigeria needed to innovate and take advantage of technology for more e-commerce revenue generating and for accountability.

The world is approaching a difficult period, and governments are under pressure to raise tax revenue as a percentage of GDP to raise much-needed funds for regional infrastructure and public services, according to Nami.

Nigeria must embrace innovation and technological advancement to make sure that internet transactions are taxed and properly recorded.

The Sentinal platform, which enables us to not only collect tax revenues at source but also gives us access to real-time tax reporting and monitoring capabilities, has greatly pleased us.

The Director General of the National Lottery Regulatory Commission of Nigeria, Lanre Gbajabiamila, commented on the development during a meeting with the head of the tax authority and called the approval of the new innovation a “major stride” for taxation of the gaming business.

According to the statement’s quotation of Gbajabiamila, “online gaming continues to expand fast in Nigeria, particularly on mobile, and the use of E-technologies’ Sentinal National Payment Gateway is a big step for us to enable us to capture gaming duty at source.”

As long as they meet all applicable requirements, such as thorough AML screening and responsible gaming procedures, we encourage all reputable offshore gaming operators to apply for a Remote Operator Permit. We are honored to have adopted the Sentinal System as the first nation, and we think Nigeria will gain greatly from it, he continued.

Leave a Reply

Your email address will not be published. Required fields are marked *