Facebook on Thursday warned Nigerian advertisers on its platform to update their Value Added Tax, VAT records to the site on or before February 25, 2022, or risk not having their adverts displayed on the platform.
The warning followed the federal government’s resolve to tax foreign-based social media platforms that earn money from Nigerian advertisers.
Recall that on December 7, 2021, President Muhammadu Buhari sent the Finance Bill 2021 to the National Assembly.
One of the major highlights of the Bill is the aspect equipping the Federal Inland Revenues Service (FIRS) with the power to evaluate non-resident firms like Twitter, Facebook, Google, and Netflix, among others, and tax them on fair and reasonable turnover earned from digital services to Nigerian customers.
The Finance Bill further directs FIRS to appoint persons for collection and remittance of non-resident taxes.
The Bill which followed the consideration of a report by the Senate Joint Committee on Finance; Customs, Excise, and Tariff; Trade and Investment, was passed by the Senate on December 21, 2021.
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In response, Facebook last year announced that all advertisers from Nigeria would pay an additional 7.5 percent VAT on ad placement from January 1, 2022.
The social media platform’s parent company, Meta, in an apparent bid to comply with the government regulation also requested its Nigerian customers to carry out basic requirements to help its compliance.
In a statement, Meta charged Nigerian customers to update their value-added tax (VAT) identification numbers by February 25.
The company said it made recent updates to allow some Nigerian customers to provide 11 or 12 digit VAT identification (ID) to pay the 7.5 percent charge.
It also added that those who already have their VAT ID can easily use receipts for other paid taxes.
Part of the statement said: “It was identified that some Nigerian customers were unable to provide their 11- or 12-digit VAT ID. An update has been made so that our system will now accept both 11- and 12-digit VAT IDs. If you want your VAT ID to show up on your ads receipts, please take the following steps below to update your VAT ID.
“In addition, if you have previously provided a VAT ID that is not 11 or 12 digits, please update it by 25 February 2022. All VAT IDs that do not comply with this format requirement will be removed after this day.
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“If you are registered for VAT and provide your VAT ID, your VAT ID will show up on your ads receipts. If you’re entitled to recover the VAT, this may help you recover any VAT you paid to the Nigerian tax authorities.”
The steps Meta said advertisers can use to add their VAT ID to their ad accounts, are: “Go to payment settings, click “edit” business info, scroll down to the field labelled “VAT ID” and add your VAT ID”.
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