The Lagos State Government has implemented a 5% withholding tax (WHT) on gaming winnings, which is due to come into force with immediate effect.
In a public notice, the authority outlined its plans to strengthen tax compliance and regulatory oversight in Nigeria’s rapidly growing gaming sector.
The new tax framework will apply to net winnings from licensed gaming platforms operating within Lagos State and is deducted automatically at the point of payout.
Licensed operators are required to remit the deducted amount directly to the Lagos State Internal Revenue Service (LIRS) – the state’s statutory tax authority.
According to state authorities, the measure forms part of a broader initiative to improve transparency, accountability and tax collection efficiency within the gaming industry.
Nigeria’s recent iGaming growth
The Nigerian gaming sector has experienced significant expansion in recent years, driven by increased mobile penetration, digital payment adoption and rising consumer participation in sports betting and online gaming. It reached a reported £2.85bn in 2025 and high-profile operators present there include Betway, Bet9ja, Nairabet and Betano.
However, amid the growth, the government has continued to clamp down on growth across Africa’s most populous country, with Bet9ja recently ordered to close operations in the city of Enugu.
The company was hit with a court order filed on behalf of the local regulator, which cited overdue tax payments and regulatory notice avoidance, but has since denied any wrongdoing, calling the ruling ‘draconian’.
Under the new arrangements, players will receive their net winnings, withholding tax deduction. However, the deducted amount will be recorded and treated as a tax credit, meaning it can be applied toward the player’s overall tax obligations where applicable.
In a statement, Bashir Are, Chief Executive Officer of the Lagos State Lotteries and Gaming Authority, said: “Under the new arrangement, 5% of qualifying gaming winnings will be automatically deducted before payment is made to players and remitted to the Lagos State Internal Revenue Service (LIRS) as the statutory tax authority.
“According to the State Government, the measure forms part of Lagos’ broader drive to strengthen tax compliance, transparency, and accountability in the rapidly expanding gaming sector.
“All licensed gaming operators in Lagos State have now been formally directed to commence the deductions with immediate effect.”
The Lagos State Government has implemented a 5% withholding tax (WHT) on gaming winnings, which is due to come into force with immediate effect. In a public notice, the authority outlined its plans to strengthen tax compliance and regulatory oversight in Nigeria’s rapidly growing gaming sector. The new tax framework will apply to net winnings