Revenue-starved Nigeria will use a platform developed by a UK-based financial technology firm to improve tax collection from online gaming companies.
The Federal Inland Revenue Service will use e-Technologies Global Ltd.’s Sentinal National Payment Gateway to automate the administration of taxes on online gaming, Muhammad Nami, the agency’s executive chairman, said in an emailed statement.
The platform will “not only collect tax revenues at source but also provide us with tax-reporting and monitoring tools in real-time,” he said.
Nigerian authorities are looking at ways to address revenue shortfalls that President Muhammadu Buhari said in his budget statement earlier this month “remain the greatest threat to Nigeria’s fiscal viability.” Africa’s largest economy’s revenue-to-gross domestic product ratio is about 8%, compared with peer South Africa’s 24.9%, complicating government efforts to rein in debt and fund infrastructure projects. Debt-service costs consumed 83% of government revenue in the eight months through August, according to the budget office.
Connecting to the platform is mandatory for local and foreign online gaming operators with immediate effect, the tax agency said.