One Tax Too Numerous | Cybersecurity Levy by Odiawa Ai

Nigerians awakened to financial fear. That day, the Central Bank of Nigeria (CBN) ordered banks to impose a cybersecurity levy of 0.5 per cent on electronic financial transactions. It has grave consequences as Nigerians are reeling under the weight of multiple charges in the midst of extreme financial difficulty, brought on by the policies of the Tinubu administration.

The levy is provocative, a smack on the chin of Nigerians battling to keep up with the little poise left from persevering through strategy estimates that have crashed the standard of living for numerous citizens.

The CBN says the levy is backed by the Cybersecurity Act 2024, which mandates banks to collect it on applicable transactions. They are to remit it to the Office of the National Security Adviser (NSA). There are 16 special cases for the law. In a nation famous for scum, who screens the organization of the asset?

It has incited huge unrest primarily because bank customers are as of now paying numerous charges, including transfer charges, stamp duty, ATM card maintenance and SMS charges. These erode the face value of bank transfers.

This adds to the rundown of impositions by a government desperate to support its finances without worries about the consequences on citizens and businesses.

First was President Tinubu’s “fuel subsidy is gone” proclamation on Inauguration Day. This plunged the nation into turmoil as petrol prices climbed by 350 per cent. After fourteen days, the administration floated the naira. It set off a remarkable devaluation that saw the currency depreciate from N460/$1 to N1,900/$ before it recovered to trade around N1,440/$.

To solve Nigeria’s perennial power deficiencies, Tinubu in April eliminated electricity subsidies to mirror commercial rates such that the 'Band A' customers now pay between N225 per kilowatt hour and N206.8KWh, up from N68KWh.

In the midst of this, diesel sells for N1,300 per litre, while petrol sells for up to N1,500pl in the rural areas. The lowest pay permitted by law is still N30,000 a month.

Basically, the cybersecurity levy is at variance with Tinubu’s policy to dispose various tax collection.

It powers bank customers to get a sense of ownership for what the banks and the government ought to do, since cybersecurity cuts across regions beyond banking.

The logical thing to do is to take a gander at the report of the Presidential Committee on Fiscal Policy and Tax Reforms, which suggested the adoption of just nine taxes instead of the 62 identified to aid easy and voluntary compliance and administration. Tragically, the government is doing the reverse.

While it is typical that the government is looking for ways to raise funds, the cybersecurity levy is ill-timed and improper, particularly when the inflation rate has topped 33 per cent as of March, up from twenty-two per cent a year ago, making hogwash of household incomes.

Numerous Nigerians question how the current taxes are utilized as there is scarcely an association between taxes accrued and public services given. Last year, the FIRS collected N12.37 trillion in taxes. This year, it has projected N18.41 trillion however Nigerians still actually need to pay for surgical gloves, water for infusion and other consumables at public hospitals; government funded schools are in a state of decay while roads are unmotorable for most regions.

The Federal Government could rake in between N3 trillion and N7.75 trillion in one year with the cybersecurity levy, as indicated by assessments by the Centre for the Promotion of Private Enterprise, yet bank customers, majority of whom are ordinary folks ought not to have their accounts raided to bridge the public deficit.

The levy could affect financial inclusion, at 74 per cent in 2023.

To work on its finances, the government ought to put a stop to crude oil theft in which about 400,000 barrels are lost daily, and cut the gigantic wastages in expenditure and overheads, including humongous sums apportioned to lawmakers for constituency projects, and unnecessary travels.