The Digital Assets Coalition has warned that Nigeria’s virtual asset economy, currently valued at $92 billion, could face lower investment and slower expansion because of the new tax rules introduced by the Nigeria Revenue Service (NRS).
The warning comes amid concerns that transaction-based charges under the new Guidelines on the Taxation of Virtual Assets could increase the cost of participating in the sector, discourage innovation and weaken the contribution of virtual assets to Nigeria’s broader digital economy.
The NRS recently released new guidelines for the taxation of digital assets including cryptocurrency.
Speaking at a media parley in Lagos, Spokesperson of the Coalition, Mr Obinna Iwuno, warned that the tax structure could have unintended consequences for a sector that has become an important channel for global payments, remittances, savings and income generation, especially among young Nigerians.
According to him, while the group supports taxation, the structure of the taxes could lead to a shift of economic activities to offshore platforms.
“We support the taxation of virtual assets without qualification. Our concern is with a design choice that taxes the movement of money itself.
“This charge falls on a remittance to a student abroad, on a freelancer converting earnings already taxed as income, and on a trader in a year they lost money. That is not a tax on profit; it is a toll on participation,” Iwuno said.
The Coalition, an alliance representing digital asset participants and operators in Nigeria, said the country’s virtual asset market, currently the largest in Sub-Saharan Africa, has grown into a significant part of the emerging digital economy and should be protected from policies that could limit investment and economic activity.
