The federal government may reintroduce the suspended 5% excise duty on telecommunications services, gaming, betting, and lottery activities.
This move is contained in the proposed “Nigeria Tax Bill 2024.” now before the national Assembly.
This marks a reversal from the tax relief measures enacted in July 2023, when President Bola Tinubu suspended the levy as part of efforts to ease the financial strain on businesses and households.
The executive bill outlines that the excise duty will apply to all excisable transactions, with the tax amount being calculated based on the service provider’s charge for the service, whether in monetary terms or its equivalent.
The bill specifically targets telecommunications, gaming, gambling, betting, and lottery services, stipulating that these industries will be subject to excise duties at rates detailed in the Tenth Schedule of the Act.
Also Read:Understanding the Tinubu tax reforms*
Maintain momentum of economic reforms,World Bank tells Nigeria
Recertification: NCAA suspends 10 private jet operations
The bill also includes provisions for currency exchange transactions involving the naira, both domestically and internationally.
It mandates that the exchange rate must not exceed the official rate authorized by the Central Bank of Nigeria (CBN).
If a transaction occurs at an exchange rate higher than the CBN’s official rate, the excess will be considered excise duty payable by the seller under the self-assessment provisions of the Nigeria Tax Administration Act.
The reintroduction of the excise duty, if passed, is expected to impact the telecom and gaming sectors significantly, industries that are vital to Nigeria’s digital and entertainment economies.
Source:Global Financial Digest
