Nigeria – VAT on Digital Financial Services 

The Federal Government of Nigeria issued a Directive informing banks and other financial institutions that, starting January 19, 2026, they should collect and remit VAT at a rate of 7.5% on the indicated electronic banking services. 

To avoid any confusion, this newly introduced tax shall be charged on the banking fees for the selected type of digital financial services, not on the transferred amount. Some of the digital financial services that are in scope of the new VAT fare are banking fees for online transfers. 

The Nigerian Government, primarily through the Ministry of Finance and the Revenue Administration, has been working over the last few years to implement an efficient tax framework for the digital economy. Taxation of taxable persons that provide digital services or products to domestic customers is a central part of the tax framework for digital service providers.

Non-resident digital service providers that receive payments from Nigerian customers should be aware that, in addition to their VAT responsibilities, local customers will likely incur an additional surcharge. These two additional taxes should be taken into account when defining the total price for offered services.