Google to Charge Nigerians 7.5% VAT starting April

Google will now charge 7.5 percent VAT on all taxable goods and services to Nigerian customers beginning April 1 next month.

The company announced this in an email to its business account holders on Tuesday morning.

The 7.5 percent VAT is in line with the government’s new law, according to the American tech behemoth.

As part of its 2020 Finance Bill, the Nigerian government increased VAT to 7.5 percent from 5 percent in January 2020. Following the government’s announcement that it would review the bill in 2019 following “consultations at various levels throughout the country,”

Zainab Ahmed, the Minister of Finance at the time, stated that the bill would be “more beneficial to state governments and Local Government Areas (LGAs) in the country, many of which are already facing difficult conditions.”

This new increase will take effect as a wave of young Nigerians flee the country in search of greener pastures in the West. Last month, at the 6th EU-AFRICA Summit in Brussels, Belgium, President Mohammadu Buhari urged Western leaders to assist him in reducing the number of young Nigerians leaving the country.

“Despite the growing possibility, irregular northward migration from my continent depletes Africa’s talent pool while causing political crises in the EU,” Buhari told world leaders at the event.

This new enforcement of the tax demonstrates the government’s lack of alignment with its mission and its people.

According to Femi Adesina, Special Adviser to the President on Media and Publicity, the Finance Bill has five strategic objectives.

“These objectives are; Promoting fiscal equity by mitigating instances of regressive taxation; Reforming domestic tax laws to align with global best practices; Introducing tax incentives for investments in infrastructure and capital markets; Supporting Micro, Small and Medium-sized businesses in line with our Ease of Doing Business Reforms; and Raising Revenues for Government.”

Femi Adesina

Google has indicated that it will not comment further on the matter, instead advising business account holders to contact their tax advisers.

“Google cannot advise you on tax matters, so please contact your tax adviser if you have any questions about this change,” the email stated.

Zoom and Facebook’s parent company META have also charged 7.5 percent VAT to Nigerian customers.

As of the first half of 2020, the bill had already helped the federal government generate 661.7 billion naira.