Lagos State begins enforcing 5 % tax on gaming winnings

Lagos State Government has started enforcing a five per cent withholding tax (WHT) on winnings from betting and gaming platforms licensed in the state. The policy, announced through a public notice by the Lagos State Lotteries and Gaming Authority (LSLGA), takes effect immediately and applies to net winnings from regulated operators.

Under the new arrangement, licensed gaming companies must automatically deduct 5 % from a player’s winnings at the point of payout before the funds are released. The deducted amount is then to be remitted directly to the Lagos State Internal Revenue Service (LIRS) as the statutory tax authority. Players will receive their winnings net of the withholding tax.

Part of broader fiscal reforms

Authorities say the measure is part of Lagos State’s broader effort to strengthen tax compliance, transparency and accountability within the rapidly growing gaming sector. Compliance measures also include requiring players to provide their National Identification Number (NIN) in line with Know-Your-Customer (KYC) regulations.

Licensed operators have been formally instructed to start deductions without delay, with the state government emphasising that the tax will serve as a tax credit for players where applicable.

Industry and regulatory context

This development comes amid ongoing complexities in Nigeria’s gambling regulatory environment, where states retain authority to regulate and tax gaming activities due to the absence of a unified national gaming commission. Industry stakeholders have previously warned that sudden tax changes can affect market competitiveness and may drive bettors to unregulated platforms.