Nigeria’s tax collection agency, the Federal Inland Revenue Service (FIRS), has recently expressed its intent to regulate the taxation of cryptocurrency within the country. Executive Chairman, Zacch Adedeji, shared the agency’s plans to present a bill to parliament by September. The intended legislation aims to control digital asset transactions in a way that promotes economic growth and prosperity.
The initiative comes amidst allegations that the uncontrolled flow of crypto-based transactions has partly contributed to the depreciation of Nigeria’s national currency. Furthermore, it’s been suggested that crypto exchanges like Binance have facilitated the untraceable transfer of vast sums of money out of the nation, impacting tax revenue collection.
The strategic response from FIRS is to embrace the evolving digital currency markets by instituting regulations that will ensure that it drives, instead of hinders, Nigeria’s economic development. The organization is hopeful that with legislative support, progressive regulation of cryptocurrency in the country would mitigate associated risks and take full advantage of the potential benefits.
These plans were revealed as part of wider efforts to overhaul Nigeria’s tax system. The need for crypto regulation was recently emphasized by Nigeria’s Minister of Finance, Wale Edun, who urged the Securities and Exchange Commission (SEC) to address this regulatory gap. In response, the SEC has initiated a process to amend the country’s Rules on Digital Assets Issuance, Offering Platforms, Exchange, and Custody to keep pace with the digital asset landscape.