Facebook introduces 7.5% Tax on adverts from Nigeria
Starting from 1st January 2022, Facebook has announced that Nigerians will pay 7.5 percent value-added tax (VAT) for all ad placements. The charge will apply to adverts running on Facebook for business or personal purposes.
According to the statement released by Facebook, “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.”
The statement added that those exempted from VAT would be able to recover the fund if they provided their tax ID. “If you’re registered for VAT and provide your VAT ID, your VAT ID will show up on your ads receipts,” it added.
Facebook (now META) is the parent company of Instagram, FB Messenger, WhatsApp, and Facebook social media channels. According to the statement, this new 7.5 percent VAT charge will also apply to Instagram ads.
The Nigerian government has been keen on taxing the digital economy in a bid to bolster its revenue generation efforts.
Last week, Nigerian president, Mohammadu Buhari transmitted the 2021 Finance Bill to the National Assembly. When it is passed into law, this bill will empower the Federal Inland Revenue Service (FIRS) to assess and charge a company’s income tax (CIT) on any digital company with a significant presence in the country, such as Facebook, Twitter, AliExpress, etc.