Disturbed by the billions of naira Nigeria loses yearly in the country’s gaming sector, stakeholders recently gathered at a two-day conference in Lagos to brainstorm on how the industry can be turned a major revenue earner for the federal government.
The participants were unanimous that the industry’s narratives must be changed and therefore recommended ways to achieve better performance and generate more revenue for the government.
The participants at the maiden national gaming conference said the industry could be better positioned through proper understanding of the financial regulatory obligations of the gaming operators, developing a regulatory framework for financial transactions, understanding taxation and resolving multiplicity of regulations in the sector.
From available statistics, the industry, including international stakeholders, generate in excess of N250 billion in 2019, yet the Nigerian government got only a paltry N1 billion.
This did not appeal well to the minister of special duties and affairs, Senator George Akume, who at the event, said the low revenue to the federal government from the sector, was unsustainable and unacceptable.
To block the leakages in betting and eliminate discrepancies observed in the books of operators, Akume said the federal government would soon acquire a central monitoring system (CMS) for the gaming industry in Nigeria.
The minister said the acquisition of the CMS would enable the Nigeria Lottery Regulatory Commission (NLRC) and its sister agency, the National Lottery Trust Fund (NLTF) to perform maximally their regulatory functions and provision of good lottery causes to Nigeria.
“This will undoubtedly entrench transparency and accountability in the industry, thereby making things a lot easier for all stakeholders,” Akume said.
In 2020, Nigeria’s video game market was worth $104 million and analysts believe this figure will rise to $126 million in 2021.
Global trends have also shown that the gaming and lottery industry, if well regulated, is a major sector for the generation of tax revenue by the government.
A participant at the conference and chief executive officer (CEO) of Midas Communications Ltd, Kehinde Olaosebikan, attributed the growth of players in the industry to the large population, especially the number of youths, increased access to digital telephones, successful internet penetration, increased access to internet-enabled devices and significant awareness being engendered by NLRC.
For NLRC director-general, Mr Lanre Gbajabiamila, the gaming industry is of concern to the government and key to its revenue enhancement. The NLRC boss said the commission is working on the amendment of existing lottery laws to provide a legislative and regulatory framework that best serves the industry. He is optimistic that the National Gaming Bill 2021 will be passed into law before the end of the year.
“The commission has consistently worked on the actualisation of a Central Monitoring System platform to ensure real-time monitoring and promote accountable transparency in the gaming sector.
“It is common knowledge that the industry has evolved and adopted technology to optimise operations so much that extant laws do not reflect the reality or trend of the Nigerian gaming industry,” he said.
The executive secretary of the National lottery trust fund, Dr Bello Maigari, admonished licensed lottery operators on prompt remittance to ensure continuity and sustainability of Corporate Social Responsibility (CSR) to the society. Maigari, who was represented by Mr Abubakar Nakwada, NLTF’s head of operations, said enhanced and improved lottery remittance would ensure the continuity of good causes for the greater wellbeing of Nigerians.
He said over the years across the globe, lottery and gaming have been identified as a wealth generator, noting that proceeds from lottery were used to transform societies and Nigeria should not be an exception.
Also, chairman, Federal Inland Revenue Service (FIRS), Muhammad Nami, said the law expects lottery operators to comply with the tax regime by registering for taxes and obtaining tax identification numbers.
Nami, who was represented by group lead strategic tax operations, FIRS, Mr Matthew Gbonjubola, said the operators were also expected to keep adequate records of all their transactions.
“Lottery operators are required to file relevant returns which include income tax, Pay As You Earn (PAYE) returns of all employees in the state where they are resident, pay withholding tax from suppliers and very importantly cooperate with tax authorities,” Nami said.
In his contribution, founder of Law Allianz, Yahaya Maikori, asks Nigerian gaming industry to invest in software as most of the revenue leaving the country from the sector was spent on software.
Similarly, Mr Adewale Akande, of Bet9naija, said most lottery operators in Nigeria do not have the technical know-how to develop software for their activities.
In a communique issued at the end of the conference, the stakeholders resolved that financial reporting standards be tailored to accommodate the peculiarities of the operators in the gaming industry.
The participants also suggested that the gaming industry, being a fledgling one, requires a robust legislative framework which would accommodate the concerns of all stakeholders.
All the operators agreed to close ranks with NLRC and its sister agency, National Lottery Trust Fund in the establishment of monumental projects to reflect the impact of lottery proceeds in the society.