Lottery Commission exempts licensed online gaming operators from FIRS direct tax collection

The National Lottery Regulatory Commission (NLRC) says Online Gaming Operators in the country who are duly licensed and tax compliant are exempted from the new tax regime proposed by the Federal Inland Revenue Service (FIRS).

A statement signed on Friday by the Director General of the commission, Mr Lanre Gbajabiamila, said that the proposed tax applied to remote gaming operators operating strictly outside the jurisdiction of the country.

FIRS on Wednesday said it was automating the administration of tax on online gaming, using Sentinal National Payment Gateway and Electronic Solution.

The Sentinal National Payment Gateway is a transaction processing system that enables integrated payment services providers to deduct taxes at the point of transaction and immediately remit to government’s treasury.

The FIRS notice stated that it was, however, not mandatory for online gaming operators offering online gaming services from outside Nigeria to be incorporated in Nigeria.

But that they must connect to the platform for the purposes of deducting tax from gaming transactions of players in Nigeria, and remitting directly to the government.

“Every operator offering online gaming services in Nigeria is required not later than Dec. 31, to connect to the Sentinal National Payment Gateway, where taxes will be deducted from the online gaming transactions and remitted directly to the relevant government treasury.

“All companies engaged in online gaming activities are to take note of this notice for compliance.

“The FIRS expects full compliance, as non-compliant operators shall be visited with sanctions in accordance with extant laws.”

Gbajabiamila, however, stated that the clarification became necessary to douse the panic and confusion already created in the gaming industry in the country regarding the propriety and justification of the new tax regime.

He said the NLRC, as the agency created by law to regulate lottery/gaming in the country, needed to make the necessary clarifications and would not renege in carrying out its statutory assignment.

“The NLRC deeply regrets any misconceptions these publications have caused to our esteemed gaming operators and other stakeholders in the industry in Nigeria,” Gbajabiamila said.