Nigeria to introduce new tax laws regulating cryptocurrency including regulations for the Nigerian crypto industry, by September 2024.
The Executive Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, announced this while speaking at the FIRS 2024 Stakeholders Engagement with the Senate and House of Representatives Committees on Finance.
At the meeting, Adedeji stated that the Federal Government would introduce new tax laws by September, adding that they are bringing a bill to overhaul the entire process of revenue administration in Nigeria to harmonise revenue collection and simplify tax laws.
“While we cannot ignore cryptocurrency as there is currently no law in Nigeria regulating it, there is a need for legislation to govern this type of transaction. This is what is being done in other countries around the world. When there are innovations in the system, you must plan to regulate them in a way that is not detrimental to the economic development of Nigeria.”
Senator Sani Musa, Chairman of the Senate Committee on Finance, acknowledged that cryptocurrencies have become a significant income source but noted the absence of a legal framework.
He stated that the proposed regulation would update outdated tax laws and expressed confidence that the Executive would submit a bill for necessary amendments, repeals, and re-enactments to reflect current trends.
Securities and Exchange Commission (SEC)
Meanwhile, the Securities and Exchange Commission (SEC) is asking virtual asset service providers to come under its Accelerated Regulatory Incubation Programme (ARIP) to accelerate their registration and onboarding for the oncoming new Digital Assets Rules. Recall that it first issued rules and guidelines for all crypto and digital asset service providers in May 2022; however, it proposed an amendment in March 2024.
What’s more, the FIRS is pursuing legal action against the global cryptocurrency exchange Binance on four counts of tax evasion. The trial for these charges has been scheduled for October 11, 2024.
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In addition to Binance, crypto firms like OKX have also discontinued services in Nigeria, citing changes in local laws and regulations. After suspending all peer-to-peer (P2P) Nigerian Naira (NGN) services, KuCoin announced that it would begin charging a value-added tax (VAT) of 7.5%, explaining that this VAT addition is a regulatory update in Nigeria.
Moreover, other African countries, including Kenya, Ghana, and South Africa, are advancing efforts to regulate the virtual asset environment.
