Economy
By Funmilola Gboteku
THE Nigerian sports betting and gaming industry has grown astronomically in the last few years.
This exceptional growth can be attributed to the large population, especially the number of youths increased access to digital telephones, successful internet penetration and increased access to internet-enabled devices.
However, in spite of the huge number of people engaged in betting, the Nigerian government generated less than N1 billion in revenue from the gaming industry in 2019.
Global trends have also shown that the gaming and lottery industry, if well regulated, is a major sector for the generation of tax revenue by the government.
In 2020, the country’s video game market was worth a total of $104 million, and analysts believe this figure will rise to $126 million in 2021.
For two days this week, stakeholders converged in Lagos to brainstorm on ways to reposition the gaming industry for better performance and revenue enhancement in the 21st century.
There is consensus among participants that this could be achieved through understanding the financial regulatory obligations of the gaming operators, developing a regulatory framework for financial transaction in the sector, understanding taxation as well as resolving multiplicity of regulations in the gaming industry.
Opening the maiden National Gaming Conference on Wednesday, the Minister of Special Duties and Intergovernmental Affairs, Sen. George Akume, said the industry, including international stakeholders, generates in excess of N250 billion in 2019, yet revenues to the government did not exceed N1 billion.
The minister noted that the low revenue to the government was not only disappointing but unsustainable and unacceptable.
In order to block leakages in betting and eliminate discrepancies observed from the books of some operators, Akume said the Federal Government would soon acquire a Central Monitoring System (CMS) for the gaming industry in Nigeria.
Akume said the acquisition of the CMS would enable the National Lottery Regulatory Commission (NLRC) and its sister agency, National Lottery Trust Fund (NLTF), to perform maximally in their regulatory functions and provision of lottery goods causes to Nigeria.
“This will undoubtedly entrench transparency and accountability in the industry, thereby making things a lot easier for all stakeholders,” the minister said.
Similarly, Mr Lanre Gbajabiamila, Director-General of NLRC, said that the gaming industry was of vital importance to the government and key to its revenue enhancement.
“The commission has consistently worked on the actualisation of a Central Monitoring System platform to ensure real-time monitoring and promote accountable transparency in the gaming sector,” Gbajabiamila said.
According to the NLRC boss, the commission is already working on the amendment of existing lottery laws to provide a legislative and regulatory framework that best serves the industry.
He was optimistic that the National Gaming Bill 2021 would be passed into law before the end of the year.
“It is common knowledge that the industry has evolved and adopted technology to optimise operations so much that extant laws do not reflect the reality or trend of the Nigerian gaming industry,” he said.
Dr Bello Maigari, NLTF Executive Secretary, on his part, admonished licensed lottery operators on prompt remittance to ensure continuity and sustainability of Corporate Social Responsibility to the society.
Maigari, who was represented by Mr Abubakar Nakwada, NLTF Head of Operations, said that enhanced and improved lottery remittance would ensure the continuity of good causes for the greater wellbeing of Nigerians.
He said that over the years across the globe, lottery and gaming have been identified as a wealth generator, noting that proceeds from lottery was used to transform societies and Nigeria should not be an exception.
The NLTF boss appealed to licensed gaming companies and promoters to submit evidence of payment of all taxes due to the Trust Fund to the regulatory authority to ease reconciliation and record keeping in line with extant government financial regulations.
He noted that for Nigeria to maximise the potentials of the industry, lottery business owners and entrepreneurs must encourage best practice, collaboration, curtail corruption and acts capable of undermining the growth of the sector.
On taxation, the Executive Chairman, Federal Inland Revenue Service (FIRS), Alhaji Muhammad Nami, said that the law expects lottery operators to comply with the tax regime by registering for taxes and obtaining tax identification numbers.
Nami, who was represented by Mr Matthew Gbonjubola, Group Lead Strategic Tax Operations, FIRS, said that operators are also expected to keep adequate records of all their transactions.
“Lottery operators are required to file relevant returns which include income tax, PAYE returns of all employees in the state where they are resident, pay withholding tax from suppliers and, very importantly, cooperate with tax authorities.
“It is not only gaming operators that complain about taxation, it is important to note that revenue must be generated to cater for citizens,” Nami said.
In his contribution, Yahaya Maikori, Founder of Law Allianz, asks the Nigerian gaming industry to invest in software as most of the revenue leaving the country through the sector was spent on software.
But Mr Adewale Akande of Bet9naija said that most lottery operators in Nigeria do not have the technical know-how to develop software for their day-to-day activities.
“The people who are capable of developing this software are outside the country, this is because we don’t develop it locally.
“We need to fund developers in Nigeria so that we can get the software we want internally, instead of importing from other countries,” Akande said.
Speaking on ethics and responsible gambling, NLRC Director of Legal Services, Mrs Olayemi Ajayi,
advised operators in the gaming industry to market and advertise responsibly to avoid portraying the sector in a wrong manner.
“All operators are expected to have both physical and virtual checks in place at all times to ensure no player below the age of 18 is allowed to play,” she said.
Olayemi said that responsible gambling is a very important element in the industry in order to protect lottery players and encourage operators to do the right thing.
“The objective of responsible gaming is to ensure the integrity of the operation of all stakeholders in the gaming industry,” the NLRC director said.
On gaming addiction, Olayemi urged players to indulge in gaming just for entertainment purposes, noting that they should not use it as a way of coping with stress, loneliness or depression.
She also stressed the need for players dealing with addiction to seek professional help or advice from a counselor.
Other ways of avoiding addiction is to always treat the money lost as a form of entertainment, she counselled.
“Set a limit to your spending at every session and stick to it; expect losses, don’t use your credit cards to play lottery games and create balance in your life,” she said.
In a communique issued after the gaming conference, the stakeholders resolved that financial reporting standards be tailored to accommodate the peculiarities of the operators in the gaming industry.
It was also suggested that the gaming industry, being a fledgling one, requires a robust legislative framework that would accommodate the concerns of all stakeholders.
Also, all operators have agreed to close ranks with the National Lottery Trust Fund in the establishment of monumental projects to reflect the impact of lottery proceeds in the society.
The NLRC is, therefore, required to set the pace by the provision of regulatory framework that will delineate the responsibilities of all stakeholders as well as guide the entire regulation of the gaming industry. (NANFeatures)
-July 30, 2021, 13:29 GMT|
Tags: Repositioning Nigerian gaming industry for better performance Revenue Generation
