Uncertainty remains over how Nigeria’s value added tax electronic invoicing requirements apply to non-resident suppliers, PricewaterhouseCoopers said in its latest report.
The report, VAT in Africa: Digital Services 2026, which was released on Tuesday, examines the tax frameworks in 28 African countries, and notes that the increasing use of streaming platforms, cloud-based business tools, online marketplaces and other electronically supplied services has created an urgent need for governments to adapt their tax systems.
Nigeria is among the countries covered by the report, which outlines the obligations of non-resident suppliers of electronically supplied services, including registration, VAT collection, returns, and invoicing.
“Although the legal and policy framework suggests that non-resident suppliers fall within scope, the NRS is yet to clearly define the operational requirements applicable to such entities,” the report stated.
It noted that, as of February 2026, the mandatory electronic invoicing requirement applied only to large taxpayers with annual turnover of N5bn and above, while the framework’s position on non-resident suppliers remained unclear.
The report advised affected businesses to engage with the tax authority for clarification and prepare for possible implementation.
The publication identifies online advertising, cloud computing, software and applications, streaming services, digital platforms and automated online services as examples of activities that can fall within digital services tax frameworks.
Under the Nigerian provisions discussed in the report, non-resident suppliers that meet the applicable VAT registration requirements are expected to collect VAT on taxable supplies to Nigerian customers and remit the tax to the Nigeria Revenue Service.
The report states that the suppliers are required to remit VAT before the 21st day of the month following the relevant transactions.
According to the report, if a foreign supplier fails to charge and collect VAT on a taxable supply, the Nigerian customer may be responsible for accounting for the tax.
It also explained that eligible non-resident suppliers can offset allowable input VAT incurred on services and fixed assets used to make taxable supplies in Nigeria against output VAT collected.
The report disclosed that 32 African countries have introduced value-added tax and other indirect tax rules to cover electronic services supplied by non-resident companies, up from 21 countries in 2024.
“Tax policymakers across Africa have taken decisive notice of the revenue mobilisation potential and trade distortions,” the report stated.
It added that 32 of the continent’s 54 countries had amended their value-added tax, goods and services tax or other indirect tax laws to bring electronic services supplied by foreign companies to local consumers within the scope of taxation.
The countries that introduced relevant rules since the first edition of the publication in 2024 include Algeria, Botswana, Chad, the Republic of Congo, Liberia, Malawi, Mauritania, Mauritius, Rwanda, Togo and Zanzibar.
According to the report, the changes are intended to address a situation in which foreign companies earn revenue from customers in African markets without necessarily having a physical presence or establishment in the countries where their services are consumed.
“The value is consumed locally, but the supplier has no physical presence, no local establishment,” the report said, explaining the challenge facing tax authorities.
It warned that the absence of appropriate legislation could leave foreign digital service providers without an obligation to collect and remit taxes in the countries where their customers reside.
The report said the resulting gap was both fiscal and competitive, as local companies supplying comparable services were required to charge domestic taxes while their foreign counterparts could operate under different obligations.
“The failure to extend the same obligation to non-resident digital suppliers creates distortions, undermines tax neutrality and deprives governments of revenue that is rightly due,” it stated.
Despite the expansion of digital taxation, PwC said Africa had yet to establish a harmonised framework for taxing the digital economy.
The publication identified differences in the types of transactions covered, registration thresholds, registration procedures and invoicing requirements as major challenges for companies operating across multiple African markets.
“The rules vary from jurisdiction to jurisdiction across several critical dimensions,” it stated, noting that some countries tax business-to-consumer transactions, others focus on business-to-business supplies, while some apply rules without making that distinction.
The differences mean that companies serving customers in several African countries may have to navigate separate registration procedures, filing deadlines and documentation requirements.
PwC’s Africa Tax and Legal Services Leader, Job Kabochi, said the continent’s digital transformation was reshaping economies and societies at an extraordinary pace.
He noted that electronically supplied services had become embedded in everyday life, supporting activities ranging from education and healthcare to business operations.