Nigeria Sues Binance for $79.5 Billion in Economic Losses and Back Taxes
Background
In March 2024, Binance, the world’s largest cryptocurrency exchange, announced that it was stopping all transactions and trading in the naira, Nigeria’s local currency. This decision was made after the company faced a government crackdown on the industry, resulting in multiple charges against its executives.
The Lawsuit
Recently, Nigeria has filed a lawsuit against Binance, seeking to compel the company to pay $79.5 billion in economic losses allegedly caused by its operations in the country, as well as $2 billion in back taxes. The lawsuit was filed by the Federal Inland Revenue Service (FIRS), Nigeria’s tax authority.
The Allegations
The FIRS alleges that Binance has a "significant economic presence" in Nigeria and is therefore liable for corporate income tax. The agency is seeking a court declaration that Binance pay income taxes for 2022 and 2023, plus a 10% annual penalty on unpaid amounts. Additionally, the FIRS is requesting a 26.75% interest rate on the unpaid taxes, based on the Central Bank of Nigeria’s lending rate.
Prior Allegations
Binance is already facing four counts of tax evasion in Nigeria, including non-payment of value-added tax, company income tax, failure to file tax returns, and complicity in helping customers to evade taxes through its platform. The company is contesting these charges.
Money Laundering Charges
Binance is also facing separate money laundering charges by Nigeria’s anti-graft agency, which it has denied.
Conclusion
The lawsuit against Binance is a significant development in the ongoing saga between the company and the Nigerian government. The outcome of this lawsuit will have important implications for the cryptocurrency industry in Nigeria and beyond.
Frequently Asked Questions
- What is the amount of economic losses being sought by Nigeria in the lawsuit?
- $79.5 billion
- What is the amount of back taxes being sought by Nigeria in the lawsuit?
- $2 billion
- What is the interest rate being sought by the FIRS on unpaid taxes?
- 26.75%
- What is the date when Binance stopped transactions and trading in the naira?
- March 2024