Some lawyers have described the introduction of the 0.5 per cent cybercrime levy on all electronic transactions by the Central Bank of Nigeria as illegal and unconstitutional.
The Cybercrimes (Prohibition, Prevention, Etc.) (Amendment) Act 2024, Section 44 (2)(a), mandates a levy of 0.5 per cent (0.005) equivalent to a half per cent of all electronic transactions value by the business specified in the Second Schedule of the Act.
The businesses include are GSM Providers and all telecoms, internet service providers, banks and other financial institutions, insurance companies and Nigeria Stock Exchange.
The Central Bank of Nigeria has issued a circular directing all banks, other financial institutions and payments service providers to implement the levy.
But speaking on the controversial law, a Senior Advocate of Nigeria (SAN), Kunle Adegoke, expressed dismay over the levy imposed by banks on electronic transfers.
According to him, the newly announced levy will not affect the rich and elites but will disproportionately affect impoverished Nigerians.
Adegoke highlighted that individuals with limited financial means have already been voicing concerns regarding additional charges on their transactions. He said: “Why I feel the timing is not appropriate is this: the law being implemented by the CBN is the Cybercrime Act of 2015 which was recently amended in 2024. And the provision requiring that 0.5 per cent be levied was contained in the 2015 Act. The CBN’s directive that 0.5 per cent be levied on every electronic transaction emanated from the 2024 amendment act.
“With this position, one feels that the spectrum of society that is going to feel it much more will be the people in the lower rung of the economic ladder, whereas the rich and the elite may not feel it as much, considering the amount that may be involved in the transactions to be carried out.
“The poor masses always have issues. They always complain that banks levy certain charges on their transactions.” In his contribution, a human rights activist, Madubuachi Idam, has likened the cyber security levy introduced by the Federal Government to stealing from Nigerians.
Describing the levy as illegal and unconstitutional to tax Nigerians for security, Idam appealed to the Federal Government to allow Nigerians to breathe.
He said: “Why must citizens bear the cost of security in Nigeria? Taxing citizens to provide cyber-security is tantamount to stealing from them by the government.
“Whether cyber or physical, security remains the exclusive responsibility of government. Under the social contract theory, citizens surrender their rights and loyalty to the state while the state in turn provides security for them. Therefore, it is grossly illegal and unconstitutional to tax citizens for the purpose of security.
“Funny how President Tinubu thinks that taxation is an alternative to production. He should be informed that he cannot tax his way out of economic crisis. Let him gather his team and think out of the box. Taxation is not an option.
“The neck pressing is too much. He should let us breathe.”