OpenAI has announced plans to begin collecting 7.5% Value Added Tax (VAT) on all its paid services in Nigeria, effective November 1, 2025.
In an email sent to Nigerian users, the company stated that the new charge complies with Section 10 of the Value Added Tax Act, Laws of the Federation of Nigeria 2004 (as amended), and the FIRS Information Circular 2021/19. The VAT will apply to all paid subscriptions, including ChatGPT Plus and any other OpenAI services billed in the country.
OpenAI also advised users with a valid Tax Identification Number (TIN) to include it in the payment section of their account to ensure proper tax documentation.
The move aligns with Nigeria’s broader efforts to tighten tax compliance for foreign digital service providers operating within its borders. Similar measures have already been implemented by Google, Netflix, Meta (Facebook), and Amazon, contributing to Nigeria’s reported ₦600 billion VAT revenue from foreign tech companies in recent years.
While no new taxes have been introduced under President Bola Tinubu’s administration, officials say the government is focusing on improving compliance and restructuring existing levies. “I challenge anyone to point to one newly added tax,” said Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy & Tax Reforms.
For Nigerian users, however, the new VAT means higher subscription costs. The ChatGPT Plus plan, currently priced at ₦31,500 ($20) per month, will rise to approximately ₦33,862.50 ($22.43) after tax.
Industry observers note that this price adjustment could have ripple effects on Nigerian AI startups that rely on OpenAI’s infrastructure, such as Decide and ChatATP, potentially increasing operational costs.
Interestingly, OpenAI recently introduced a lower-cost subscription tier priced at around ₦7,000 per month, a move seen as an attempt to cushion the effect of the price increase and maintain affordability for its growing Nigerian user base.
OpenAI’s compliance marks another step in the integration of global tech firms into Nigeria’s digital tax system, reflecting the country’s evolving approach to regulating its fast-growing digital economy.
