The Lagos State Lotteries and Gaming Authority (LSLGA) in Nigeria recently announced a 5% withholding tax on all online gambling winnings for licensed platforms, effective immediately. This tax will be automatically deducted at the time of withdrawal and remitted to the state tax office. In plain terms, the money players just won hasn't even warmed up before 5% is taken away. The state government claims this move aims to enhance tax compliance and industry transparency, but insiders warn that such abrupt taxation could push players towards unregulated black markets. Interested in the tax dynamics of the African gambling market? PASA's official website continuously tracks policy changes across countries.
1. New Tax Details: Automatic Deduction, Effective Immediately
Bashir Are, CEO of the Lagos State Lotteries and Gaming Authority, clarified in the announcement:
Tax Rate: 5% on net winnings
Scope: All licensed platforms in Lagos State
Implementation: Automatically deducted at withdrawal, remitted by operators to the state tax office
Effective Date: Effective immediately from the day of announcement (Thursday)
The state government states that this is part of Lagos's effort to "enhance the rapidly growing gambling industry's tax compliance, transparency, and accountability."
2. Industry Warning: Tax Volatility is Africa's Biggest Compliance Challenge
Peter Ksitiwe, CEO of the African iGaming Alliance, warned in December last year that "volatility" in taxation is the biggest compliance challenge facing the African gambling industry by 2025. He pointed out:
Sudden increases in withholding taxes, shifting to turnover taxes, or introducing new types of taxes can destabilize licensed operators
Such changes distort price competitiveness and accelerate the loss of players to unregulated platforms
The new policy in Lagos precisely reflects these concerns.
3. Regulatory Background: Federal Bill Fails, State Authority Dominates the Future
This individual taxation by Lagos occurs against the backdrop of a struggle between federal and state regulatory powers in Nigeria. Last December, President Bola Tinubu vetoed the "Central Gambling Act," aimed at establishing a nationwide uniform regulation, meaning states continue to hold gambling regulatory authority.
Are stated at the ICE Barcelona event in January that the responsibility to establish a sound regulatory environment now falls on the states. He promised that Lagos would provide a transparent, convenient operating environment, including assistance with bank account openings, protection of operators from interference by other government agencies, and claimed "our taxes are very lenient"—but the new 5% tax seems to subtly contrast this statement.
————
This article is from "PASA-Global iGaming Leaders," a gambling industry news channel: https://t.me/pasa_news
Original in-depth gambling channel: https://t.me/gamblingdeep
Free data reports: @pasa_research
PASA Matrix: @pasa002_bot
PASA official website: https://www.pasa.news
