FIRS Postpones Implementation of Simplified Compliance Regime for Online Import Tax
By Patience Ikpeme
The Federal Inland Revenue Service (FIRS) has announced the postponement of the commencement of a simplified compliance regime for Value Added Tax (VAT) on imported goods purchased through digital platforms.
Originally scheduled to be implemented on January 1st, 2024, the new guidelines will now be rolled out at a later date to allow for further development and stakeholder consultations.
FIRS Executive Chairman, Zacch Adedeji, explained that the postponement is necessary to ensure the development of a seamless process for the effective and efficient collection and remittance of the tax. This additional time will enable FIRS to refine the system and facilitate a smoother transition for both online businesses and consumers.
The simplified compliance regime, once operational, aims to streamline the VAT collection process for non-resident suppliers who sell goods to Nigeria through digital platforms, such as e-commerce websites. This move aligns with the global trend towards taxing online transactions and promoting fairness for domestic businesses.
Mr. Adedeji emphasized FIRS’ commitment to engaging with stakeholders and conducting discussions with industry representatives, tax practitioners, and relevant government agencies. These consultations aim to ensure that the final guidelines are practical, efficient, and meet the needs of all parties involved.
While the simplified VAT regime for goods awaits its launch, the existing guidelines for services and intangibles provided by non-resident suppliers remain in effect. These guidelines, which were implemented in January 2022, apply to digital services such as streaming platforms and software downloads.
