The Federal Government plan to impose tax on Cryptocurrency in Nigeria is no longer news; according to Punch Newspaper, the tax on Cryptocurrency will be included in the Finance Bill 2022.  The Finance Bill 2022 will bring every sector of the economy into tax net which includes Capital Gains Tax from digital assets, cable undertakings and Gaming Business.

According to the report, the bill which is an amendment under chargeable acts states that all forms of property shall be assets for the purposes of this Act, whether situated in Nigeria or not, including Options, debts, digital assets and incorporeal property generally.

The Minister of Finance, Zainab Ahmed, as reported by tokenpost.com stated that the bill is aimed to change the excise and duty statues; the bill will make provisions that will enable the government to levy on taxes on Cryptocurrency and other digital transaction. As we look into what the Tax might pose to digital economy, we will take a brief look into the cryptocurrency suspension and how the Central Bank of Nigeria declined its funding in the month of February, 2022.

The Unforgotten Story of the Cryptocurrency Ban:

On the 5^th of February, 2021, the Central Bank of Nigeria published a circular directing all banks to discontinue the transaction in and with persons dealing in Cryptocurrency.  According to its directive, the Central Bank of Nigeria instructed all banks in Nigeria to close the accounts of persons and entities involved in Cryptocurrency transaction within their systems.

The Central Bank of Nigeria cited that the transaction of Cryptocurrency is a tool for terrorism financing, money laundering and financial vices. It is rather confusing that it is the same Cryptocurrency the government are making much effort to impose a tax on.

The plan of the Ministry of Finance to impose tax on the cryptocurrency it suspended alongside CBN raises the question on their honesty on this taxation and why they suspended the transaction in the first instance despite fining Banks such as Access Bank for 500 million, Stanbic IBTC and UBA for 800 million in April 2022 as reported by techcabal.com.

The Question of the Ministry of Finance intention ?

There are economic advantages of the crypto taxation in an economy; it helps to regulate the digital and revenue going into the digital economy. The ban of Cryptocurrency and the tax that the government plan to impose raises the question of the government hidden intention despite the show of dishonesty in its ban.

There is a urge for clarity of what the Federal Government intend with this.  As long as we see the economic benefit the Federal Government clarity is important to note on this. As long as the tax will help ease transaction, there is a need for government to come clear on its intention on its original intent following the suspension of cryptocurrency funding.

The post Cryptocurrency Tax and the clarity on Digital Space in Nigeria appeared first on WeeTracker.

On the 5th of June 2021, the Federal Government of Nigeria banned the operation of Twitter on the basis of Twitter deleting and suspending the account of President Muhammadu Buhari for a post warning the people in the southeastern region of a civil war repetition due to the insurgency in the state. Despite protests from social media influencers and human right activist likewise shutting out over 200 million people, according to dw.com ; the ban lasted for 8 months before it was lifted in January 2022. According to the Guardian, United Kingdom, some of the conditions for lifting the ban include the registration of twitter with the corporate affairs commission as a business unit and the management of prohibited publications according to Nigerian law.

The Aftermath of the ban and the Pursuit for Social Media Regulation:

The Federal Government, grieved by the domination of the social media space during the EndSars Protest, decided to embark on social media regulation. The Federal Government claimed that the decision was to tackle the blackmail and false information against the Federal Government of Nigeria. In June 2022, according to techcabal, the National Information Technology Development Agency announced that the Nigerian Government has set out plans in January to regulate its social media space in Nigeria with a new code of practice. The code of practice is a drafted document for Internet Intermediaries and Interactive Computer Service Platform by the National Information Technology Development Agency in alliance with the Nigerian Communication and the National Broadcasting Commission in anticipation the regulate the content being uploaded or shared on the technological and electronic medium. The document stated the prohibited materials that are not permitted and the obligations and restrictions placed on the medium of the information being shared.

The Effect of the Code of Practice for Regulation:

The quest to regulate raises a question of safety for social media companies and digital companies in Nigeria. Tech firms are not left out of the reality of them battling with the Federal Government over the restriction of sharing content and being monitored by the Government.

Social Media Regulation was not implemented to favour the digital space in the country; the anticipation to restrict the content shared on every technological and electronic medium is observed as a threat to the free press and freedom of expression in Nigeria. Considering the restriction, it was seen as a human right violation and a threat to privacy.                                                                                                                                

The decision by the National Information Technology Development Agency to regulate content was seen as a passive decision without consultation, which is similar to the ban. There are different views to the code of practice yet the majority is not in support of the restrictions that are placed on content shared on each medium. The social media space is seen as a place to express their opinion; restricting them from sharing their thought, content or action is similar to being caged by law or order, which is similar to the military approach, which has a negative effect on the digital economy in Nigeria.  

The code of practice affects the digital space negatively, rendering the industry ineffective when each activity is being restricted.

 Social Media Space, Digital Marketing Expert and Tech firm stand a risk of losing their space with the regulatory policy in place. Irrespective of the intention, the Federal Government must come to terms with a digital expert rather than go its own way with no further consultation.

The post Social Media Regulatory Policy and the inflexible freedom of expression in Nigeria’s social media space appeared first on WeeTracker.

The excitement about the E-Naira Digital Currency is minimal across the country; despite the awareness by top commercial banks in Nigeria, it is being widely criticized following the ban on Cryptocurrency by the Central Bank of Naira. With the mixed reaction of Nigerians, I will be looking at E-naira being an advantage or disadvantage to the economy. The E-naira was seen by a few people as a good idea, but many asked if it was the right step to take following the ban on Cryptocurrency in the country. 

E-Naira digital currency was launched on October 25, 2021; According to the report of restofworld.org published on November 19, 2021, it was seen as a game changer that will transform commerce in Nigeria being the first country in Africa to introduce digital currency across the continent. It was seen as the alternative to the ban of Cryptocurrency by the Central Bank of Nigeria; According to a report by imf.org published on November 16, 2021: E-Naira use blockchain technology such as Bitcoin and Ethereum, it can be stored in the digital wallet and can be used for electronic transaction and transfer across the world at no cost. Despite these features, the E naira is not seen as a national asset but a digital form of currency that draw its inspiration from the Physical currency but again we ask of what benefit is this to an economy with an inflation of 18%  and a huge rise in the rate of unemployment. What will the invention of the E-Naira solve in scathing economy as Nigeria? A question that lingers on our minds each time we think of the invention and the controversy around it.

CBN instructed that Banks and Financial institution to close the account of individuals that is engaged in a crypto transaction as reported by premium times published in the month of September 2021. The directive from the Central Bank of Nigeria sparked a negative reaction among people in Nigeria, prompting them to ask if they could still buy bitcoin and engage in crypto transaction despite the directive from the Central Bank of Nigeria not to facilitate the crypto transaction. The Central Bank of Nigeria stated that it was uncomfortable with the crypto transactions and will continue to educate the masses to stop using digital assets to protect the financial sector from cyber criminals. 

According to report by imf.org published on November 16, 2021: E-Naira use blockchain technology such as Bitcoin and Ethereum, it can be stored in a digital wallet and can be used for electronic transaction and transfer across the world at no cost. Despite these features, the E naira is not seen as a national asset but a digital form of currency that draws its inspiration from Physical currency, but again, we ask what benefit this is to an economy with an inflation of 18%  and a huge rise in the rate of unemployment.

E NAIRA SOLVING AN ECONOMIC PROBLEM DESPITE THE BAN OF CRYPTO:

What will the invention of the E-Naira solve in a scathing economy as Nigeria?  This a question that lingers on our minds each time we think of the invention and the controversy around it. CBN instructed that Banks and Financial institution to close the account of individuals that is engaged in the crypto transaction, as reported by premium times published in the month of September 2021.

The directive from the Central Bank of Nigeria sparked a negative reaction among people in Nigeria, prompting them to ask if they could still buy bitcoin and engage in crypto transactions despite the directive from the Central Bank of Nigeria not to facilitate the crypto transaction. The Central Bank of Nigeria stated that it was not comfortable with crypto transactions and it will continue to educate the masses to stop using digital assets to protect the financial sector from cyber criminals.

Cover photo Photo by Dignited

The post E-NAIRA- AN ADVANTAGE OR DISADVANTAGE TO THE ECONOMY? appeared first on WeeTracker.