The Lagos State Government has commenced the implementation of a five per cent withholding tax on gaming winnings from all licensed gaming platforms operating within the state.
The policy takes immediate effect and applies to net winnings, with the tax deducted at the point of payout to players.
Operators Directed to Comply
In a public notice signed by Are Bashir, Chief Executive Officer of the Lagos State Lotteries and Gaming Authority, all licensed gaming operators in Lagos were directed to comply fully with the new tax framework.
According to the notice, the five per cent deduction will be automatically withheld by operators before winnings are paid out and subsequently remitted to the Lagos State Internal Revenue Service as the statutory tax authority.
Boosting Compliance in the Gaming Sector
The Lagos State Government explained that the policy is part of broader efforts to strengthen tax compliance, transparency, and accountability in the fast-growing gaming industry.
Under the new arrangement, players are required to provide their National Identification Number (NIN) in line with Know Your Customer (KYC) regulations.
How the Tax Works
The 5% tax is deducted only from net winnings
Deductions and remittances are handled exclusively by licensed operators
Players receive winnings after the statutory deduction
Proper records must be maintained to ensure transparency
The authority further clarified that the withholding tax deducted will serve as a tax credit to the player.
“All licensed gaming operators in Lagos State have now been formally directed to commence the deductions with immediate effect,” the notice stated.
The state government reiterated that the policy is designed to ensure proper regulation of the gaming industry while aligning both operators and players with existing tax obligations in Lagos State.
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