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The Cloud Network Foundation (CNF) has strongly criticized the federal government’s decision to implement a 0.0005% tax on cybersecurity, describing it as anti-people and burdensome to Nigerians.
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In a statement released in Lagos by the CNF, a technology-focused foundation dedicated to ensuring the well-being of the technology ecosystem and netizens, its chairman, Mr. Abimbola Tooki, urged the government to rescind the decision immediately, citing concerns about its impact on the populace.
The foundation expressed dismay over the announcement by the Federal Government that the Central Bank of Nigeria would begin implementing an amended 2015 Cybersecurity Act, which would levy a 0.0005% fee on all electronic transactions starting May 20.
Notably, this levy represents a staggering 900% increase from existing rate over electronic transactions. CNF also raised concerns about the additional burden the cybersecurity levy would impose on Nigerians, especially low-income earners who heavily rely on electronic transactions for their daily activities.
The CNF likened the introduction of the new levy to a resurgence of taxation reminiscent of the days of Israel under Biblical King Rehoboam. It criticized the government for further burdening the people with additional taxes at a time when Nigerians are already grappling with high costs of living.
The foundation highlighted that the levy would be charged in addition to existing fees such as stamp duty and electronic transfer charges, exacerbating the financial strain on Nigerians.
The Cybersecurity Act, initially passed in 2015, introduced a 0.005% levy on electronic transfers. However, it is alleged that the recent amendment in 2024 saw a significant increase in the levy to 0.5%, extending its coverage to fintechs, payment service providers, and other financial institutions.
The CNF also noted that the National Security Adviser, Nuhu Ribadu, advocated for the implementation of the amended act, signaling increased government influence in cybersecurity matters.
In response to the government’s directive, the Central Bank of Nigeria issued a circular to all financial institutions, instructing them to commence the levy implementation starting two weeks from Monday, May 6, 2024. Financial institutions are required to deduct and remit the levy to the National Cybersecurity Fund administered by the Office of the National Security Adviser.
The CNF reiterated its stance against the imposition of the cybersecurity levy, emphasizing the adverse effects it would have on the Nigerian populace and urging the government to reconsider its decision in the interest of the people.
