The Federal Inland Revenue Service (FIRS) said it is now compulsory for payment gateways in Nigeria to report all transactions passing through their systems for tax compliance monitoring as it rolled out e-invoicing for major businesses in the country.

Payment gateways are online platforms licensed by the Central Bank of Nigeria (CBN) that enable businesses to securely process electronic payments from customers.

Some of them are fintechs like Flutterwave, Paystack, Remita, and Interswitch.

Acting Director, Tax Automation at FIRS, Mike Adoga,  said this at a 2-day workshop on the e-invoicing solution in Lagos, he also said the submission from payment gateways is imperative to ensure that all business transactions pass through the FIRS Merchant Buying Solution (MBS).

“If you’re tempted as a taxpayer not to declare your invoices on the invoicing platform, that would not be a very good idea, because we have given all the payment gateways the responsibility of reporting every payment that passes through them to us,” Adoga told the stakeholders.

Giving reasons for the new automated tax system, Adoga cited reports indicating that Nigeria’s tax-to-GDP ratio is hovering around 10%.

“What this means is that only 10% of taxable transactions have been captured. That’s not good for us as a country. This is why we put the frameworks in place to enable us to do the right thing more easily,” he said.