Nigeria is the most populous country in Africa, with 213.4 million people living there. Given the number of people who call Nigeria home, it’s unsurprising that the country has the largest gambling market in Africa. However, the market is highly unregulated even though certain aspects were legalised in 2005.
This lack of effective regulation at the federal level means that the Nigerian economy does not benefit from the collection of licensing fees and the creation of jobs as it should. We are going to examine the legal position regarding gambling in Nigeria, including the online casino landscape where no regulation currently exists.
The legal landscape for casinos in Nigeria
The Nigerian Lottery was legalised in 2005 and is regulated by the National Lottery Regulatory Commission. In wider terms, gambling is dealt with under Chapter 22 of the Criminal Code Act enacted in 1990. This law splits games into those that are legal and those that are not legal. Legal games in include land-based casinos, sports betting, and the lottery.
Games that are not legal include roulette, dice games, and card games that do not involve any skill. In the case of online gambling, sports betting is permitted whereas there is no mention of online casinos. Although there is no specific law against online casinos, the lack of regulation means that the Nigerian economy misses out on potential revenue as Nigerian residents play at offshore sites.
You can get an idea of the sums involved by looking at regulated sports betting in Nigeria. In 2019, Research and Markets valued the overall sports industry in the country at around $2 billion dollars. The “Finance Bill” that is currently awaiting presidential assent amends section 15 of the Companies Income Tax Act (CITA). This amendment includes the taxation of lottery and gaming businesses and clarifies the tax position of the industry.
If this amendment comes into force and online casinos were regulated, they could be subject to taxation, thereby raising valuable revenue for the government. This revenue is one of the benefits of regulating online casinos in Nigeria.
Potential benefits of regulating online casinos in Nigeria
Nigeria has the highest GDP in Africa. This GDP was $441.5 billion in 2021. Despite this, potential benefits to economic growth from online casinos would be welcome. These benefits include the additional government revenue we have already discussed. However, they do not stop there. The regulation of online casinos in Nigeria could also lead to the growth of related industries such as gaming operators, game designers, and customer service operatives. Each of these related areas could lead to job opportunities for people in Nigeria, thereby boosting economic growth.
For an example of how useful a regulated online casino industry could be for the economy of Nigeria, it’s interesting to look at the UK. There is a large, regulated UK casino industry. Casinos in the industry are licensed by the UK Gambling Commission (UKGC). This licensing includes the provision of fair gaming and secure services. All casinos with these licenses are part of GAMSTOP, which provides registration and self-exclusion for anyone struggling with gambling. Players can also choose to use reputable casinos not on GAMSTOP that provide an equally high level of service.
Overall, remote gambling in the UK has a combined gross gambling yield (GGY) of £3.2 billion. This GGY equates to 52.3% of the overall gambling market in the country. Duty is payable on this GGY at the following levels:
- First £2,686,000 GGY 15%
- Next £1,852,000 GGY 20%
- Next £3,243,000 GGY 30%
- Next £6,845,000 GGY 40%
- The remainder of GGY 50%
You can see the potential of taxation on GGY if the online casino industry was regulated in Nigeria and if taxation laws were passed. Add to this the boost to related industries and jobs in Nigeria, and you can clearly see the benefits of regulated online casinos for economic growth in Nigeria.
and then