Nigerians to start paying tax for using Facebook from next year

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Beginning January 1, 2022, Nigerians will be required to pay value added tax (VAT) for accessing Facebook.tax for using Facebook

The tax is levied directly on Nigerians who utilize the social media platform to market or sell their goods.

Facebook has already started sending out emails to its users informing them of the change.

Nigerians would now have to pay a 7.5 percent VAT as a result of the new development.

Hitvibz gathered that the following email was sent to Facebook users;

Due to implementation of a value-added tax (VAT) in Nigeria, Facebook is required to charge VAT on the sale of ads to advertisers, regardless of whether you’re buying ads for business or personal purposes.

“All advertisers with a business country of Nigeria will be charged an additional 7.5% VAT on advertising services purchased beginning 1 January 2022.

“If you’re registered for VAT and provide your VAT ID, your VAT ID will show up on your ads receipts. In the event that you’re entitled to recover VAT, this may help you recover any VAT you paid to the Nigerian tax authorities if you are a VAT registered business in Nigeria.”

The Companies Income Tax (Significant Economic Presence) Order, which was introduced in 2020 as a modification to the Finance Act 2019, is the basis for the new tax regime.

The document levies a tax on any “foreign company with respect to specific services or digital transactions” that offers services to Nigerians and earns revenue in naira.

This is also reflected in the Finance Bill 2021, which received second reading in the National Assembly’s Red Chamber (NASS) on Wednesday.

 

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