The Executive Chairman of the Federal Inland Revenue Service (FIRS), Muhammad Nami, says Nigeria will focus on its digital economy in 2022.
In a statement on Thursday, Nami stressed that non-resident firms with significant economic presence that generate turnover in the country will be taxed.
“We will implement the published guidelines … to collect VAT on digital supply of services and intangibles to Nigeria,” Nigeria’s tax chief said.
“The FIRS has deployed a digital interface to facilitate implementation and also determine companies that generate relevant turnover from Nigeria,” Nami added.
Recall that the Finance Minister, Zainab Ahmed, recently announced that as part of fiscal reforms to boost revenues and diversify the oil-dependent economy, Nigeria plans to tax digital non-resident companies that sell products to local customers at 6% of turnover.
The Minister explained that digital services include; apps, high frequency trading, electronic data storage and online advertising.
The World Bank also said last year that Nigeria needed to increase non-oil taxes to at least 12.75% of gross domestic product to boost growth.
Nigeria has one of the lowest tax rates in the world, at about 4.5% of GDP,and has struggled to increase tax collection from its non-oil sector.
The FIRS has deployed a digital interface to facilitate implementation and also determine companies that generate relevant turnover from Nigeria, Nami said.
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