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Nigeria 5% withholding VAT on e-commerce 2020

  • Aug 7, 2019 | Richard Asquith

Nigeria is considering becoming the latest country to introduce a withholding VAT regime on e-commerce. This would require payment providers, credit cards and other electronic payment schemes to hold back 5% VAT on any transaction between a Nigerian consumer and an online seller. This VAT would then be forwarded directly to the tax authorities.

With increased levels of online sales in one of Africa’s largest economies, the Federal Inland Revenue Service measure would be particularly effective forwith local players Jumia and Konga. But also for foreign platforms such as China’s AliExpress where levels of compliance by foreign sellers may be more challenging.

Early 2020 is the likely implementation date. Argentina is already operating a similar scheme, with other countries expected to follow as they look to improve VAT collections on cross-border e-commerce.

VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He can be contacted at: He is part of the European leadership team which won International Tax Review's 2020 Tax Technology Firm of the Year. Richard trained as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.
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