The Federal Inland Revenue Service (FIRS) and the National Lottery Regulatory Commission (NLRC) have commenced process to automate the collection of Value Added Tax (VAT) on lottery and gaming businesses in Nigeria.
Mr Wahab Gbadamosi, Head, Communications and SERVICOM Department, FRIS, made this known in a statement in Abuja on Monday.
Gbadamosi said that the agreement was sealed between the Executive Chairman of FIRS, Babatunde Fowler and operators of lottery businesses in Lagos on Monday.
He quoted Fowler as saying that the automation of collection of VAT from all betting placements was a lawful way of raising the country’s revenue profile to enable the government function optimally.
“FIRS in partnership with relevant stakeholders have earlier automated VAT collection in some other sectors like aviation and the successes recorded in those sectors will be replicated in the lottery industry.
“Tax has to do with the law. What we are doing is to find a way to make tax collection seamless, convenient and efficient.
“We are automating VAT across various industries in the country. What we are doing with the gaming industry is not strange.
“This automation is not intended to harm the industries, rather it is meant to improve the lives of everyone because VAT revenue is shared among the three tiers of government.
“It is also used to provide social amenities and make life better for everyone,” he said.
Fowler explained that the addition of five per cent VAT would not discourage lottery businesses but would rather strengthen them.
The Gbadamosi also quoted the Director-General of the NLRC, Lanre Gbajabiamila, as saying that the automation of VAT collection in the lottery businesses was a well thought initiative that would work seamlessly.
“The NLRC and the FIRS are working together to ensure that this automation process is seamless. The importance of taxation cannot be overemphasised.
“VAT is essentially a consumption tax. In the gaming industry, lottery agents fail to collect VAT thereby causing loss of revenue to the government.
“Lottery is taxable and we have to comply with the law. Therefore, thinking out a way to solve this problem is a welcome development.
“The NLRC is not going to sit down and watch the lotto businesses in this country fold up. We will work together to ensure that they succeed,” he said. (NAN)