The Lagos State Government has announced the implementation of a 5% withholding tax on gaming payouts, requiring licensed betting enterprises throughout the state to begin immediate automatic deductions from customer earnings.
Mr. Are Bashir, the Chief Executive Officer of the Lagos State Lotteries and Gaming Authority, gave the direction in a public notice to licensed gaming platforms, confirming the immediate implementation of the tax system targeting gains made by regulated betting operators.
According to the letter sent on Friday, the state has begun to implement a 5% Withholding Tax (WHT) deduction on gaming profits in accordance with current Nigerian tax laws and regulatory regulations controlling the gaming industry.
The cut will be applied straight to the players’ earnings before payment is processed.
The letter stated that the tax applies to net winnings from licensed gambling platforms operating in Lagos State and will be deducted at the time of payment. All licensed gaming operators have been instructed to immediately comply with the framework.
Under the agreement, betting companies must automatically deduct a part of earnings and pay it to the Lagos State Internal Revenue Service (LIRS), the statutory tax authority.
Officials explained that the policy is part of broader budgetary measures aimed at improving supervision, transparency, and responsibility in the fast-expanding gambling industry.
The legislation also imposes stronger identity verification requirements on players, including conformity with national identification rules.
According to the authorities, players must disclose their National Identification Number (NIN) in compliance with Know Your Customer (KYC) regulations, while licensed operators must manage deductions and remittances in accordance with regulatory standards.
The government stated that bettors will get their profits net of the statutory deduction, with proper records kept for transparency. It further stated that the withheld tax would be used as a tax credit for players.
All licensed gambling operators in Lagos State have been legally advised to start the deductions immediately.
