As Nigeria grapples with a staggering inflation rate of 33.2% in March, the recent directive from the Central Bank of Nigeria (CBN) regarding a cybersecurity levy has ignited widespread discontent among the populace.
The CBN’s announcement instructed banks to initiate the deduction process for the cybersecurity levy, which will be administered by the Office of the National Security Adviser (NSA). This levy, aimed at bolstering cybersecurity measures, has faced vehement opposition from Nigerians who are already burdened by the escalating cost of living crisis.
In response to the levy, many Nigerians have taken to social media platforms to express their dissatisfaction, highlighting the strain it will place on their finances.
The cybersecurity levy stems from the enactment of the 2024 Cybercrime (Prohibition, Prevention, etc.) Amendment Act, which mandates a 0.5% deduction from the value of all electronic transactions. This levy is earmarked for the National Cyber Security Fund, overseen by the office of the NSA.
As the debate surrounding the cybersecurity levy intensifies, it shows the broader challenges facing the Nigerian economy, including inflationary pressures and the need for effective cybersecurity measures. With citizens grappling with soaring living costs, the imposition of additional levies has reignited calls for fiscal prudence and accountability from government authorities.
Recommended reading: Here are 16 transaction types exempted from CBN’s cybersecurity levy
Reactions
Victor Abiola
- “Why should Citizens be levied for the runnings of the CBN or the NSA? Will other Government agencies also start levying us? Will the deduction of this levy be monthly or per transaction? What will the funds collected be used to do? All of these levies and taxes with just an income bracket of N30,000 minimum wage. God go help us. This particular provision should be reviewed.”
Why should Citizens be levied for the runnings of the CBN or the NSA?
Will other Government agencies also start levying us?
Will the deduction of this levy be monthly or per transaction?
What will the funds collected be used to do?
All of these levies and taxes with just… https://t.co/0vyZPQkJxK
— Victor Abiola (@victor_abiolaa) May 7, 2024
_Enemali
- “The CBN cannot be encouraging a cashless economy then go ahead to reap customers of every kobo they have all in the name of taxes. The multiple taxation being experienced in the banking sector must stop. If government need more money. They should cut down their reckless expenditures.”
The CBN cannot be encouraging a cashless economy then go ahead to reap customers of every kobo they have all in the name of taxes.
The multiple taxation being experienced in the banking sector must stop. If government need more money. They should cut down their reckless…
— Governor (@_Enemali) May 7, 2024
Akuabatalum
- “On the actual percentage of the Levy, if the Act says 0.005%, why is CBN imposing 0.5%? From my math knowledge, I am aware that 0.005 is not the same as 0.5 and the latter is higher. Either it is an error from the CBN or an exaggeration of the prescribed Levy by the Law.”
On the actual percentage of the Levy, if the Act says 0.005%, why is CBN imposing 0.5%? From my math knowledge, I am aware that 0.005 is not the same as 0.5 and the latter is higher. Either it is an error from the CBN or an exaggeration of the prescribed Levy by the Law. pic.twitter.com/N6wvKqqrem
— ⚖️ 🧑💻Akụabatalụm (@Chimdimma92) May 7, 2024
Olumide Adesina
- “The CBN should review this levy, it will likely have a negative impact on banks, this is because the incentives to transact with financial institutions will reduce, it’s too expensive.”
The CBN should review this levy, it will likely have a negative impact on 🇳🇬 banks, this is because the incentives to transact with financial institutions will reduce, it's too expensive
— Olumide Adesina (@olumidecapital) May 6, 2024
Moha Sheikh
- “Will the CBN or the banks take responsibility or refund money to an account holders if money is lost or their account wiped off through cyber attacks ? If not, they should not add any levy to our transactions because it won’t be of any benefit to us. If they charge, then, they just have to take responsibility and be ready to refund.”
Will the CBN or the banks take responsibility or refund money to an account holders if money is lost or their account wiped off through cyber attacks ? If not, they should not add any levy to our transactions because it won't be of any benefit to us. If they charge, then, they… https://t.co/Td5hew00ga
— 𝗠𝗼𝗵𝗮 𝗦𝗵𝗲𝗶𝗸𝗵 (@MohaSheikh__) May 7, 2024
OurFaveOnlineDoc
- “The CBN has reportedly directed all banks to impose a “0.5% cybersecurity levy” on all bank transactions. The money raised is to be sent to the office of the National Security Adviser. A circular from the apex bank on Monday disclosed that the implementation of the levy would start two weeks from today. The circular was directed to all commercial, merchant, non-interest and payment service banks, among others. Does anyone know why this is?”
The CBN has reportedly directed all banks to impose a “0.5% cybersecurity levy” on all bank transactions.
The money raised is to be sent to the office of the National Security Adviser.
A circular from the apex bank on Monday disclosed that the implementation of the levy would… pic.twitter.com/BAXg5awKB5
— #OurFavOnlineDoc 🩺 🇬🇧 (@OurFavOnlineDoc) May 6, 2024
Felix Emeka
- “The CBN has directed all banks to impose a 0.5% cybersecurity levy on all transactions. The monies are to be remitted to the office of the National Security Adviser Mallam Nuhu Ribadu. I said it that it is the only tax that is on this people’s head. This administration is determined to tax citizens for depression. God help us”
The CBN has directed all banks to impose a 0.5% cybersecurity levy on all transactions.
The monies is to be remitted to the office of the National Security Adviser Mallam Nuhu Ribadu.I said it that it is only tax that is on this people's head.
This administration is determined… pic.twitter.com/kcaTLat21t— Felix Emeka (@felimek) May 7, 2024
Theo Abu
- “So, if I make a transfer of One Million Naira, my bank will charge me 5k according to the new circular by the CBN. I am honestly tired.”
So, if I make a transfer of One Million Naira, my bank will charge me 5k according to the new circular by the CBN.
I am honestly tired.
— Thεό Abu (@TheoAbuAgada) May 6, 2024
Daniel
- “Except the aim of the CBN is to reduce financial inclusion and increase cash outside banks, this 0.5%(even with the exemptions) does not make sense. 0.5% levy applied, is actually huge. You are not fighting cybercrime,you are fighting the people. Cardi B, pls behave.”
Except the aim of the CBN is to reduce financial inclusion and increase cash outside banks, this 0.5%(even with the exemptions) does not make sense. 0.5% levy applied, is actually huge. You are not fighting cybercrime,you are fighting the people.
Cardi B, pls behave.— DANIEL (@DanielWhalee) May 7, 2024
Theotherayo
- “Very USELESS POLICY made up to rob the citizens, why the hell is the CBN funding a government agency?? What for, remitting the money to whose pockets??? What is this?”
Very USELESS POLICY made up to rob the citizens, why the hell is the CBN funding a government agency?? What for, remitting the money to whose pockets??? What is this?
— nehe.0x (@theotherayo) May 7, 2024
Some context
The implementation of this new levy presents both challenges and implications for consumers and businesses across Nigeria.
For everyday users, the imposition of an additional charge on transactions raises concerns about the escalating cost of digital services. This development has the potential to influence consumer behavior, leading to shifts in spending patterns and affecting digital adoption rates among the populace.
On the business front, companies are compelled to reassess their financial strategies to accommodate the levy while navigating the complexities of managing operational costs.
Adhering to the levy’s requirements becomes paramount, necessitating adjustments to existing financial frameworks and systems to ensure compliance.
The stringent penalty outlined for non-compliance highlights the gravity of this initiative. With defaulting entities facing penalties amounting to no less than 2% of their annual turnover, there is a clear imperative for businesses to adhere strictly to the levy’s provisions.
