By Ugbokholen Angel
The federal government in 15 months, has reportedly raked in N1.98tn in taxes from Google, Netflix, Facebook, and other foreign companies operating in the country.
The National Bureau of Statistics said the figure includes both Company Income Tax and Value Added Tax.
The Federal Inland Revenue Service noted that the CIT is a 30 percent tax imposed on the profit of companies, while the VAT is a 7.5 percent consumption tax paid for and borne by the final consumer for goods purchased and services rendered.
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The Companies Income Tax (Significant Economic Presence) Order of 2020, an amendment of the Finance Act 2019, was issued by the former Minister of Finance, Zainab Ahmed. The order targeted taxing foreign entities that engage in specific services or digital transactions while having a Significant Economic Presence in Nigeria.
In spite of the complexities encountered in enforcing the law on foreign companies generating income from Nigeria, such companies under the FIRS jurisdiction have collectively paid N1.98 trillion in taxes to the federal government from Q1 2022 to Q1 2023.
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Within this time frame, N1.32 trillion was collected through CIT, and N661.93billion through VAT, contributing to the Federal Government’s revenue
In a remarkable boost to Nigeria’s economy, the government has announced a staggering N2tn in tax revenue generated from global tech giants such as Google, Netflix, and Facebook. This significant milestone highlights the growing influence and financial impact of these companies within the country.
The influx of tax revenue can be attributed to Nigeria’s welcoming environment for foreign tech giants, which has encouraged their investment and expansion in the country. With a vibrant and tech-savvy population, Nigeria has become an attractive market for these companies, resulting in substantial contributions to the nation’s coffers.
Google, a leading search engine and technology powerhouse, has not only provided valuable services to Nigerians but also contributed significantly to the country’s tax revenue. The company’s various initiatives, including digital skills training and support for local businesses, have further solidified its positive impact on Nigeria’s economy.
Netflix, the world’s leading streaming platform, has captivated Nigerian audiences with its diverse content offerings. The company’s investment in local productions and collaborations with Nigerian filmmakers has not only entertained millions but also generated substantial tax revenue for the country.
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Facebook, a social media giant, has played a pivotal role in connecting Nigerians and fostering online communities. The company’s commitment to supporting small businesses and entrepreneurs through its platforms has contributed to Nigeria’s economic growth and tax revenue.
The Nigerian government has recognized the importance of this revenue stream and has implemented policies to ensure fair taxation from these tech giants. This revenue will undoubtedly be instrumental in funding critical infrastructure projects, improving public services, and driving economic development across the country.
As Nigeria continues to position itself as a hub for technological innovation and digital transformation, the contribution of foreign tech giants will play an increasingly vital role in the nation’s progress. The government’s efforts to create a conducive environment for these companies to thrive have yielded fruitful results, as evidenced by the significant tax revenue generated.
With the continued growth of the tech industry in Nigeria, it is expected that the tax revenue from these foreign tech giants will continue to rise, further bolstering the country’s economic prospects. This remarkable achievement serves as a testament to Nigeria’s potential as a global tech powerhouse and its ability to harness the benefits of digital innovation for the betterment of its citizens.