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Nigerians, operators kick as FIRS plans to impose VAT on sports betting - TODAY
4th March, 19:02For a while, the sports betting industry in Nigeria has been rife with the news that the Federal Inland Revenue Service (FIRS) had concluded plans to introduce the 7.5% value-added tax to betting activities within the country. Under the proposed plan, punters placing a bet of 1,000 Naira would have had to pay 1,075 Naira to capture the 7.5% VAT.
The news had sent the industry into panic as the economic realities of the country continue to affect the revenue of businesses in various sectors. In the sports betting industry, individual punters and operators have continued to argue about the proposed development; this thus prompted a stakeholders meeting where representatives of sports betting companies and operators met to present their arguments.
Under their umbrella body (Association of Nigerian Bookmakers), sports betting operators (represented by Miss Fadekemi Akeju and Mrs Bimpe Akingba) made a presentation on the impracticability of the introduction of a 7.5% VAT on sports betting. The betting operators cited examples when people bet about 100,000 Naira to win 105,000 Naira and wondered how practical that would be if the punter had to pay 7,500 Naira as VAT to get winnings of 5,000 Naira.
Speaking at the stakeholders meeting which held on Wednesday, 26th February at the National Assembly quarters in Abuja, Director General of the National Lottery Commission Mr Lanre Gbajabiamila agreed that it was impracticable to impose VAT on betting stakes, his advice was to perhaps explore the possibility of charging VAT on winnings before they are paid out to punters. A banker (name withheld) who is a regular with one of the sports betting companies in Nigeria, said there was no way he would continue placing bets if the plan becomes a reality. He added that the government should focus on improving the economy, rather than trying to tax every avenue where people bolster their dwindling income.
A representative of the FIRS, Pam Davou, Director, collection who was at the meeting said he appreciated the views raised and suggested a continuous discussion between operators and FIRS to find a feasible solution.