Nigerians to pay VAT on online transactions from January 2020 – FIRS




FIRS Boss, Babatunde Fowler Photo: PM News

The Federal Inland Revenue Service (FIRS) has disclosed that Nigerians would be charged Value Added Tax (VAT) On online transactions, both domestic and international.

Babatunde Fowler, FIRS executive chairman stated this on Monday at the African Tax Administration Forum (ATAF) technical workshop in Abuja.

Fowler, however said the date of commencement of the VAT on online transactions would be subject to government’s approval.

He added that there was a need to tap into the potentials of online businesses to generate more revenue for the nation.

The FIRS boss further said Nigeria could do better than its 17% VAT collection. Citing the example of Senegal, which generates 51% of its revenue from VAT.

“We have thrown it out to Nigerians. Effective from January 2020, we will ask banks to charge VAT on online transactions, both domestic and international.

“VAT remains the cash cow in most African countries, with an average VAT-to-total tax revenue rate of 31%. This is higher than the Organisation for Economic Cooperation and Development’s average of 20%.

“This statistics, therefore, is a validation of the need for us to streamline the administration of this tax with the full knowledge of its potential contributions to national budgets.

“It is, however, also bearing in mind the rights of our taxpayers,” Fowler said.

“We have thrown it out to Nigerians. Effective from January 2020, we will ask banks to charge VAT on online transactions, both domestic and international.

“We have thrown it out to Nigerians. Effective from January 2020, we will ask banks to charge VAT on online transactions, both domestic and international.

“VAT remains the cash cow in most African countries, with an average VAT-to-total tax revenue rate of 31%. This is higher than the Organisation for Economic Cooperation and Development’s average of 20%.

“This statistics, therefore, is a validation of the need for us to streamline the administration of this tax with the full knowledge of its potential contributions to national budgets.

“It is, however, also bearing in mind the rights of our taxpayers,” Fowler said.

“VAT remains the cash cow in most African countries, with an average VAT-to-total tax revenue rate of 31%. This is higher than the Organisation for Economic Cooperation and Development’s average of 20%.

“This statistics, therefore, is a validation of the need for us to streamline the administration of this tax with the full knowledge of its potential contributions to national budgets.

“It is, however, also bearing in mind the rights of our taxpayers,” Fowler said.




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