Nigeria's Crypto Market Under Pressure from Suffocating Tax Rules

Nigeria's thriving virtual asset market, valued at $92 billion, is facing significant challenges due to new tax rules that critics argue are suffocating and driving operators offshore.

The Digital Assets Coalition (DAC), representing digital asset operators and stakeholders in Nigeria, has expressed concerns over three provisions in the new framework. These include a 1.5% stamp duty on conversions between naira and digital assets, a 1% withholding tax deducted from every digital asset sale, and the requirement to remit taxes in digital tokens rather than naira.

The coalition argues that these rules are overly broad, taxing transactions regardless of profit or loss, and will disproportionately affect young Nigerians who have built the market into an infrastructure for global earnings, family remittances, and savings.

According to Obinna Iwuno, spokesperson of the Digital Assets Coalition, 'We support taxation of virtual assets without qualification. Our concern is with a design choice that taxes the movement of money itself.'