Nigeria plans to tax crypto transactions

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Wed, 22 Mar 2023, 11:59 AM
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Nigeria plans to tax crypto transactions

Lagos, Nigeria / Image by: Wikimedia Commons

Tue, 06 Dec 2022, 06:47 am UTC

Crypto investors in Nigeria could soon be subjected to higher costs for their digital assets investments. A Nigerian finance bill, which seeks to reform the country’s different tax regulations, contains provisions that allow the government to tax cryptos such as Bitcoin (BTC) and Ether (ETH), and other digital asset transactions.

The finance bill, which aims to change the excise and duty statutes, has provisions that would enable the government to levy taxes on crypto and other digital currency transactions, according to Nigeria's finance minister, Zainab Ahmed. The finance minister explained that taxing these transactions is consistent with the Nigerian government's overarching objective of raising more revenue from e-commerce transactions, Bitcoin.com reported.

If the finance bill gets approved, Nigeria will join other African nations like South Africa and Kenya that currently collect taxes on cryptocurrency transactions, as mentioned in a report by The Cable. The paper also lists other nations that impose taxes on transactions involving digital assets, including Australia, India, the United Kingdom, and the United States.

“Also the bill contains an amendment under Chargeable Assets stating that ‘subject to any exceptions provided by this Act,’ all forms of property shall be assets for this Act, whether situated in Nigeria or not, including options, debts, digital assets, and incorporeal property generally,” Ahmed commented on the bill during a virtual meeting.

According to the source, the state governors for Sokoto, Borno, Kaduna, Kebbi, and Ogun all commented on the bill after Ahmed finished her presentation. The governors’ input will be incorporated into the draft legislation before it will be sent to the Federal Executive Council before the bill is forwarded to the Nigerian National Assembly for deliberation.

A number of countries are planning to tighten their respective crypto regulations and boost revenue from the sector. For instance, Italy’s new government is planning to impose a 26% capital gains tax on crypto assets for profits over 2,000 euros ($2,080) to crypto assets.

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