Lagos implements 5% withholding tax on gaming winnings
The policy applies to all regulated platforms operating within the state’s jurisdiction, including sports betting and online gaming sites.
Nigeria.- The Lagos State Government has begun enforcing a 5 per cent withholding tax on gaming and betting winnings, a policy aimed at formalising revenue collection in one of Africa’s fastest-growing gambling markets. Under the new directive, licensed gaming operators in Lagos are required to automatically deduct 5 per cent from net winnings before paying out gamblers. The withheld amount is remitted directly to the Lagos State Internal Revenue Service (LIRS) as statutory tax.
The policy applies to all regulated platforms operating within the state’s jurisdiction, including sports betting and online gaming sites. According to the Lagos State Lotteries and Gaming Authority (LSLGA), the measure is consistent with existing Nigerian tax laws and is designed to strengthen compliance, transparency and accountability in the expanding gaming sector.
A key feature of the enforcement is the requirement for players to provide a valid National Identification Number (NIN) as part of Know-Your-Customer (KYC) protocols before winnings can be released. This measure is intended to create a clearer record of payouts and support tax administration efforts within the industry.
With the withholding tax in place, bettors receive their winnings after tax is automatically deducted at source. Licensed operators are required to incorporate the deduction into their payout systems and remit the funds to the state tax authority.
The development follows broader discussions on gambling taxation in Nigeria, where withholding tax on gaming has formed part of wider fiscal reforms in recent years.
Public and industry responses to the new tax have been mixed. Supporters note that the levy could increase state revenue, whereas critics warn it may burden casual bettors and push some betting activity offshore.
