The Federal Inland Revenue Service (FIRS) has postponed the commencement of a simplified compliance regime for Value Added Tax (VAT) on imported goods purchased through digital platforms.
Initially scheduled for January 1st, 2024, the new guidelines will now be rolled out at a later date, following further development and stakeholder consultations.
“This postponement,” explained FIRS Executive Chairman, Zacch Adedeji, “is to allow the Service to conclude the development of a seamless process for the effective and efficient collection and remittance of the tax.”
The delay provides FIRS with additional time to refine the system and ultimately aim for a smoother transition for both online businesses and consumers.
The simplified compliance regime, once operational, will streamline the VAT collection process for non-resident suppliers selling goods to Nigeria through digital platforms like e-commerce websites.
This move aligns with a global trend towards taxing online transactions and ensuring fairness for domestic businesses.
However, acknowledging the need for a well-calibrated approach, Adedeji emphasized FIRS’ commitment to “continuous engagement with stakeholders.” This includes discussions with industry representatives, tax practitioners, and relevant government agencies to ensure the final guidelines are practical, efficient, and meet the needs of all parties involved.
While the simplified VAT regime for goods awaits its launch, the existing guidelines for services and intangibles provided by non-resident suppliers remain in effect. These were implemented in January 2022 and apply to digital services like streaming platforms and software downloads.
Credit: thenationonlineng.net
