Securities and Exchange Commission (SEC) said that it will prohibit person-to-person (P2P) cryptocurrency trading in the Naira, aiming to safeguard its local currency from further depreciation and market manipulation.

This decision comes amidst concerns over the manipulation of the naira’s exchange rate by speculators operating within the P2P crypto trading sector.

Emomotimi Agama, director general, SEC,  disclosed during a meeting with fintech professionals that new regulations targeted at crypto exchanges, digital asset custodians, and other sectors of the cryptocurrency industry would be introduced shortly.

The upcoming regulatory changes come amid growing concerns over the impact of cryptocurrency on the naira’s exchange rate.

Despite these developments, Agama expressed openness to dialogue with industry stakeholders.

He stressed the importance of cooperation in implementing new regulations to safeguard the crypto space.

Agama’s proactive engagement aims to reassure stakeholders unsettled by recent events, including crackdowns on global cryptocurrency exchanges like Binance.

SEC move to ‘delist’ the local currency is part of broader efforts to regulate the crypto industry. Nigeria’s decision reflects a broader global debate about how to regulate cryptocurrencies effectively.

Finding the right balance between oversight and innovation will be key to shaping a healthy crypto ecosystem that benefits everyone.

The aim is to stop people from manipulating the naira’s value.

While this sounds good, some worry it could limit access to cryptocurrencies for everyday Nigerians who rely on these platforms.

Balancing regulation and innovation is tricky. Regulation is important to protect people and ensure fair markets.

But it’s also important not to stifle new ideas. Cryptocurrencies offer new ways of doing things and can help people financially.

The challenge is to make rules that encourage this while also dealing with problems like fraud.

Presidential Committee on Fiscal Policy and Tax Reforms has recommended an upward review of the Value Added Tax (VAT) from the present 7.5 per cent.

Taiwo Oyedele, chairman of the committee, also suggested that the VAT revenue sharing formula should be reviewed.

He spoke at a policy exposure and impact assessment session organised by the committee, according to reports.

The proposal is coming amid opposition to several new taxes and levies like the 0.5 per cent for cybersecurity and stamp duty on mortgage loans experts, chambers of commerce and the organised labour say will create additional burden on Nigerians and the businesses which are struggling to survive.

But Oyedele allayed the fears over the impending review, saying it would not affect the poor and small business owners.

While it was not clear the percentage of the proposed increase, 7.5 per cent is currently paid as VAT.

The federal government had increased VAT from five per cent to 7.5 per cent in February, 2020, following the passage of the 2020 Finance Act.

He further said, “Nigeria’s economy is more than 50 per cent in services, and if I just stop at this, many states will be broke because VAT collection will go down by more than 50 per cent, and it won’t even fly.

“Therefore, we need to adjust the VAT rate upward. We would ensure that it doesn’t affect businesses. The only thing is to look at basic consumption from food, education, medical services and accommodation will carry zero per cent VAT. So, for the poor and small businesses, no VAT.

“We have spoken to businesses about it and they won’t increase the products’ prices. We want to make sure when we do VAT reform, no one will increase the price of commodities. We will work the mathematics with the private sector.”

The committee, Oyedele added, had also proposed a review of the state and local governments’ share of VAT revenue to 90 per cent, as well as reducing the federal government’s share from 15 per cent to 10 per cent.

Section 40 of the VAT Act provides that the federal government gets 15 per cent, states share 50 per cent and local governments share the balance of 35 per cent.

He added that, “We are proposing that the federal government’s portion should be reduced from 15 per cent to 10 per cent. States’ portion will be increased, but they would share 90 per cent with local governments.”

He explained that the proposed adjustment of the sharing formula in favour of states was due to the fact that VAT was a tax of the states.

He said. “In 1986, we had sales tax collected by states. The military came up with VAT in 1993 and stopped sales tax, so they said it would collect VAT and return 15 per cent as cost of collection, and that was how the 15 per cent charged today came about. But we think it is too much.”

A bank customer in Nigeria pays as much as five different charges electronic transactions on one account and Netizens are not happy about it.

Only on Monday, Central Bank of Nigeria (CBN), added another 0.5 per cent cybersecurity levy to be charged on select bank transactions.

However, the apex bank exempted loan disbursements and repayments, salary payments, intra-account transfers within the same bank or between different banks for the same customer, and intra-bank transfers between customers of the same bank from the levy.

Also exempted from the levy were inter-branch transfers within a bank, cheque clearing and settlements, ⁠Letters of Credits, ⁠and Banks’ recapitalisation-related funding only bulk funds movement from collection accounts, savings, and deposits, including transactions involving long-term investments, among others.

But below is the list of charges Nigerians have to pay whenever they make electronic transfers.

1. Cybersecurity levy

N5 is charged on the transaction of N1,000

N50 is charged on the transaction of N10,000

N500 is charged on the transaction of N100,000

N5,000 is charged on the transaction of N1,000,000

N50,000 is charged on the transaction of N10,000,000

2. Transfer fee

N10 is being charged on the transaction below N5,000

N25 is being charged on the transaction between 5,001 and N50,000

N50 is being charged on transactions above N50,000

3. Stamp duties

N50 is being charged on transactions between N10,000 and N10,000,000

4. Short Messaging Service (SMS)

N4 is being charged on each electronic transfer notification

(Customers who use e-mail-only notification are not charged for this service)

5. Value Added Tax (VAT)

N0.75 is being charged on the N10 transfer fee

N1.875 is being charged on the N25 transfer fee

N3.75 is being charged on the N50 transfer fee.