The Executive Chairman of the Federal Inland Revenue Service (FIRS), Dr. Zacch Adedeji, announced that the Federal Government is set to introduce new tax laws by September, which will include regulations for the cryptocurrency industry.
Speaking on Saturday at the FIRS 2024 Stakeholders Engagement with the Senate and House of Representatives Committees on Finance in Lagos, Dr. Adedeji highlighted the absence of current legal frameworks governing cryptocurrency in Nigeria, calling for the urgent need for regulation.
Nigeria’s cryptocurrency industry is estimated to be worth up to $400 million and one of the largest in Africa around 33% of the country’s population holds one form of cryptocurrency.
According to a report by Chainalysis, Nigeria’s cryptocurrency transaction volume experienced a 9% year-over-year growth, reaching $56.7 billion between July 2022 and June 2023.
He also noted that the forthcoming tax laws aim to overhaul the nation’s revenue administration, harmonize and simplify existing tax laws, and enhance services to support President Bola Tinubu’s economic plan.
He said, “For example, the stamp duty tax law of 1939 when there was no internet or connectivity, nor Local Government. Part of the reason President Bola Tinubu set up the Tax and Fiscal Reform Committee is to check these lapses and take care of the concerns by September.”
“While we cannot avoid cryptocurrency as there is no law in Nigeria presently regulating it, there is a need for a law that regulates this line of transaction. This is what is applicable in other countries of the world. When there are innovations of system, you must plan to regulate it in such a way that it is not injurious to economy development of Nigeria,”
Dr. Adedeji expressed gratitude to the National Assembly for its unwavering support to the Federal Inland Revenue Service (FIRS) over the years, which has enabled the agency to meet its targets and facilitate wealth distribution.
Dr. Adedeji further highlighted that the FIRS is on track to achieve the N19.4 trillion target set by the National Assembly at the beginning of the year.
Need for regulating the crypto industry in Nigeria
- Sen. Muhammed Musa, Chairman of the Senate Committee on Finance, stated that regulating the cryptocurrency industry was crucial for providing the country with appropriate legislation for tax collection and revenue generation.
- He mentioned that the process would allow for the modification of tax laws that have been in place since before Nigeria’s independence.
- The lawmaker expressed confidence that the Executive would submit the necessary bill after the Senate resumes recess, enabling amendments, repeals, and the re-enactment of laws that align with current trends.
- He noted that considering technological advancements, cryptocurrencies have become a significant means of generating income, yet Nigeria lacks the necessary legal framework to govern this area.