The National Assembly has reignited discussions to implement a 5% excise duty on telecommunications, gaming, betting, and lottery services, reversing the previous exemption established under former President Muhammadu Buhari.
The proposed tax comes as part of the “Nigeria Tax Bill 2024,” which seeks to levy an excise duty on various services, despite a suspension of such taxes signed into effect by President Bola Tinubu on July 6, 2023.
The executive orders were intended to alleviate the financial burden on businesses and households amid rising tax concerns.
According to the newly introduced bill, the excise duty will apply to the total charges imposed by service providers, whether in monetary terms or equivalent value.
The text of the bill explicitly states that services including telecommunications, gaming, gambling, betting, and lotteries offered within Nigeria will be subject to the excise duties as outlined in the Tenth Schedule of the Act.
In addition to the excise provisions, the bill addresses currency exchange transactions involving the naira, stipulating that these transactions must adhere to the official exchange rate set by the Central Bank of Nigeria (CBN).
Any transaction that exceeds the official rate will incur an excise duty on the excess amount, assessed via self-assessment under the Nigeria Tax Administration Act.
The move has generated mixed reactions among stakeholders, with concerns that reintroducing the excise duty could lead to increased costs for consumers and businesses in the telecommunications and betting sectors. As discussions continue, the impact of this potential tax on the economy and service providers remains a critical point of debate.
