FG Proposes New Law To Regulate Cryptocurrency

The Federal Government is set to introduce a new law to regulate the cryptocurrency industry in Nigeria, marking a significant step towards establishing a legal framework for digital assets in the country.

Zacch Adedeji, the Executive Chairman of the Federal Inland Revenue Service (FIRS), revealed this during a stakeholder engagement with the Senate and House Committee on Finance.

The event, organized by the Intergovernmental Relations Department of the FIRS, was themed ‘Repositioning The FIRS To Achieve Its Mandate.’

He said, “The plan first is to have the law that regulates it, and that is why you see that we are here with the legislature, which will be the base of charging. And that is done in any other place in the world when you have this innovation or system, so you just have to get ready for it because you can’t go away from it. So we just have to plan to regulate it in such a way that it is not injurious to the economic development of Nigeria.”

READ: EPL: Viewing Centres Increase Charges Amidst Fuel Price Hike

During his speech, Adedeji informed the lawmakers about the proposed bill.

He told them, “Just to put you on notice, by September, we are proposing a law that would overhaul the whole process of revenue administration in Nigeria, harmonising, recoding and simplifying the tax laws that we have. For example, in the Stamp Duty Act of 1939, when there was no internet connection, we needed to bring it up.

“Today, we cannot run away from cryptocurrency but as we stand today, there is no law anywhere in Nigeria that regulates cryptocurrency. We cannot run away from it.”

Cryptocurrency platforms have been subjected to intense scrutiny following the exit of Binance, which was accused by the Nigerian government of manipulating the naira-to-dollar exchange rate.

READ: CBN Lifts Ban On Cryptocurrency Transactions

Recently, Nigeria imposed a 7.5 per cent Value-Added Tax on crypto transaction fees. This was revealed by a cryptocurrency exchange, KuCoin, when it told its users it would start VAT collection on July 8, 2024.

At the end of 2023, the Central Bank of Nigeria lifted its ban on banks operating accounts for crypto service providers, which signalled a shift towards a more open but regulated approach, which was welcomed by many local crypto users.