Facebook has announced that individuals and businesses who want to place advertisements on its platform will now pay the 7.5 per cent Value Added Tax (VAT) for such service from January 1, 2022.
The social media company announced this in a statement issued on Thursday.
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The US-based company said the tax will apply to those buying ads for either business or personal purposes.
The statement read: “Due to implementation of a value-added tax (VAT) in Nigeria, Facebook is required to charge VAT on the sale of ads to advertisers, regardless of whether you’re buying ads for business or personal purposes.
“All advertisers with a business country of Nigeria will be charged an additional 7.5% VAT on advertising services purchased beginning 1 January 2022.
“If you’re registered for VAT and provide your VAT ID, your VAT ID will show up on your ads receipts.”
Facebook also stated that the categories of entities exempted from VAT would be able to recover the fund if they provided their tax ID.
“In the event that you’re entitled to recover the VAT, this may help you recover any VAT you paid to the Nigerian tax authorities if you are a VAT registered business in Nigeria,” the statement read.
The move has been described by business and tax experts as a means by the Federal Government to increase government revenue and widen the country’s tax net