As Nigerians grapple with unprecedented high cost of living due to fuel subsidy removal, flotation of the naira, hike in electricity rate for Band A customers, the Central Bank of Nigeria (CBN) issued a circular directing the imposition of a 0.5% levy on electronic money transfers to be remitted to the National Cybersecurity Fund domiciled at the Office of the National Security Adviser.
Section 44(2)(a) of the Cybercrimes (Prohibition, Prevention, etc.) (Amendment) Act, 2024 provides that “a levy of 0.5% (0.005) equivalent to half percent of all electronic transactions value by businesses specified in the Second Schedule to the Act be paid into the Cybersecurity Fund.
The businesses listed in the Second Schedule to the Act include GSM Service Providers and all telecommunication companies; Internet Service Providers; Banks and Other Financial Institutions; Insurance Companies and the Nigerian Stock Exchange.
Expectedly, organised labour, Civil Society Organisations as well as economic experts have rejected this new tax in both concept and timing.
President Joe Ajaero of the Nigeria Labour Congress (NLC) demanded the immediate withdrawal of the levy, saying it is another anti-people policy of the government amid excruciating economic hardship.
Ajaero said in a statement: “This levy, to be implemented by deduction at the transaction origination, is yet another burden on the shoulders of hardworking Nigerians.
“The directive comes on the heels of the recent implementation of stamp duty charges on mortgage-backed loans and bonds by the federal government, further straining the financial resources of Nigerians. These successive levies only serve to deepen the financial burden on citizens already grappling with economic challenges.
“The NLC calls on the federal government to reconsider these directives and prioritise policies that alleviate the financial burdens of Nigerians.
“We urge a collaborative approach between the government, regulatory bodies, and stakeholders to develop sustainable cybersecurity measures that do not unduly burden the populace”, he said.
In its reaction, the Nigerian Economic Summit Group (NESG) cautioned that the policy may induce several Nigerians to boycott electronic fund transfers, thereby hamper the government’s revenue drive.
The NESG, therefore, urged that the levy should be deferred until the Presidential Committee on Fiscal Policy and Tax Reforms submits its report since one of its mandates is to streamline taxes.
Also, the Socio-Economic Rights and Accountability Project (SERAP) issued a 48-hour notice to the Federal Government to reverse the 0.5 per cent cybersecurity levy or risk legal action.
In the midst of this debacle, the House of Representatives directed the CBN to withdraw its circular, saying that the apex bank misinterpreted the provisions of the Act and should immediately issue an unequivocal circular in line with the letter and spirit of the law.
This follows a motion moved by the Minority Leader, Kingsley Chinda (PDP, Rivers) which states “The wording of the CBN Circular leaves the CBN directive open to multiple interpretations, including that the levy be paid by bank customers, that is, Nigerians, against the letters and spirit of Section 44(2)(a) and the Second Schedule to the Cybercrimes Act, which specifies the businesses that should be levied accordingly.
“Unless immediate pragmatic steps are taken to halt the proposed action of the CBN, the Cybercrime Act shall be implemented in error at a time when Nigerians are experiencing the aftermath of multiple removals of subsidies from petroleum, electricity, and so on, amidst rising inflation”, he said.
We at Daily Trust therefore call on President Bola Ahmed Tinubu to prevail on the CBN governor Olayemi Cardoso to withdraw his circular, which misinterpreted the provisions of Section 44(2)(a) of the Cybercrime (Prohibition, Prevention,etc) (amendment) Act 2024.
We also urge Mr. President to tarry a while before imposing new taxes on the specified businesses until Nigerians feel the promised positive impact of the various economic policies initiated by this government.
Until then we say No to the imposition of the Cybersecurity Levy.
