FIRS Begins Direct Collection Of Taxes From Online Gaming Operators

The Federal Inland Revenue Service (FIRS) has commenced the deduction of taxes at transaction points from online game transactions using the 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 points of transaction and immediately remit the tax deducted to the government’s treasury. It is used to automate the administration of tax that enables the tax watchdog to deduct taxes at transaction-points and remit the tax deducted directly to government’s treasury.In a public notice signed by its chairman, Muhammad Nami, the service while directing full compliance by the online gaming community, FIRS said “The deployment of Sentinal National Payment Gateway will simplify tax compliance for companies engaged in online gaming activities.”

The FIRS also states that all operators offering online gaming services in Nigeria, not later than the 31st of December 2022, were required “to connect to the Sentinal National Payment Gateway, deduct tax from online gaming transactions and remit same directly to the relevant government’s treasury.”

The notice stated that though it was not mandatory for online gaming operators offering online gaming services from outside Nigeria to be incorporated in Nigeria, they are compelled by extant tax laws to connect to the Sentinal National Payment Gateway for the purposes of dedicating tax from the gaming transactions of players in Nigeria, and remitting same directly to the government purse.