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The Nigerian financial authorities recently announced their plan to overhaul the tax system to add crypto assets. The upcoming proposal, which aims to modernize the current policies and adapt to the evolving financial landscape, was praised by a Nigerian organization that called the efforts a “game-changing” move for the country’s economic growth.
FIRS’s Tax Overhaul To Boost Foreign Investment
On Monday, the Nigeria Professionals in Diaspora organization applauded the Federal Inland Revenue Service’s (FIRS) efforts to modernize the country’s law system.
The group’s President, Obiora Okereke, and Home Secretary, Bukola Shonekan, praised the FIRS’s recently announced plan, highlighting the tax authorities’ efforts to evolve Nigeria’s financial landscape and align with global standards.
According to local reports, the statement deemed the upcoming crypto tax reform a “bold step towards embracing the digital economy,” noting that the current policies are unfit for today’s landscape.
To the organization, the FIRS’s plan to establish clear guidelines for crypto assets and leverage technology to ease compliance is a “game changer” for economic growth. Moreover, they consider the move will “boost confidence” in the market and protect customers.
By setting clear rules for digital assets, these reforms make it easier for people and businesses to understand and meet their tax responsibilities. This clarity helps boost confidence in the cryptocurrency market and encourages more people to get involved.
Clear guidelines for crypto taxation could also attract international investment, which has been affected by the country’s crackdown on the sector. Organizations like the Blockchain Industry Coordinating Committee of Nigeria (BICCoN) have noted that disputes like the Binance saga have already affected the industry.
In June, BICCoN expressed concerns about the overall negative impact of the country’s crypto crackdown, stating there has been a “noticeable decline in investments in Nigerian web3 startups.”
Okereke and Shonekan urged investors to support the FIRS’s initiatives, stating that “this move will create a more transparent, secure, and thriving financial system for Nigeria.”
Crypto Tax Proposal Set For September
Earlier this month, FIRS revealed its plan to propose a bill to add cryptocurrencies to the tax law. The Services’ Executive Chairman, Zacch Adedeji, announced the institution will seek the National Assembly’s support to overhaul the whole process of revenue administration in the country.
The bill, set to be presented in September, will seek to “harmonize, recode, and simplify” the tax laws in Nigeria. Additionally, it aims to modernize outdated policies that didn’t account for technological developments like the Internet or crypto assets.
During the meeting with the National Assembly’s Finance Committees, Chair Adedeji recognized the increasing rate of crypto assets’ adoption and highlighted the need to regulate the industry without compromising the country’s economic development:
The plan first is to have the law that regulates it, and that is why you see that we are here with the legislature, which will be the base of charging. And that is done in any other place in the world when you have this innovation or system, so you just have to get ready for it because you can’t go away from it. So we just have to plan to regulate it in such a way that it is not injurious to the economic development of Nigeria.
The inclusion in the tax overhaul is part of the country’s apparent shift toward the sector, which includes the Securities and Exchange Commission’s reported plans to regulate the crypto market and license virtual asset providers.
Featured Image from Unsplash.com, Chart from TradingView.com
