The Nigerian government, through the Federal Inland Revenue Service (FIRS), has approached the Federal High Court in Abuja, seeking an order for Binance Holdings Limited, a global cryptocurrency exchange platform, to pay $79.5 billion for alleged economic losses and an additional $2 billion in unpaid taxes for 2022 and 2023.
According to court documents, the government claims Binance’s operations in Nigeria led to financial damages, citing unpaid income taxes and penalties. The lawsuit demands a 10% penalty for tax non-compliance, a 26.75% interest charge based on the Central Bank of Nigeria (CBN) lending rate, and other financial penalties dating back to January 1, 2023.
Binance is also facing legal action against two of its executives, Tigran Gambaryan and Nadeem Anjarwalla. The Nigerian government alleges that Binance failed to register with the FIRS for tax compliance and contributed to economic instability through its business practices.
The allegations against Binance include violations of several Nigerian laws, such as the Companies Income Tax (CIT) Act, the Federal Inland Revenue Service (Establishment) Act 2007, and the CBN Regulatory Framework for Mobile Money Services. Additionally, the government cites breaches of the CIT Significant Economic Presence (SEP) Order.
The SEP Order, enacted in May 2020 under former Finance Minister Zainab Shamsuna Ahmed, mandates taxation for foreign digital service providers operating in Nigeria. According to the law, any foreign company generating an annual turnover of at least N25 million (or its equivalent in foreign currency) from digital activities in Nigeria is considered to have a significant economic presence and is liable for taxation.
The Nigerian government insists that Binance deliberately concealed its operations to evade taxation, despite having a substantial market presence in the country.
