The recent announcement of a 0.5 percent cybersecurity levy on electronic transactions by the Central Bank of Nigeria (CBN) has stirred up concerns among businesses and citizens alike. Industry leaders, including Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), have expressed worries about the potential economic impact of this directive.
Yusuf highlighted the challenges faced by businesses and citizens in the current economic climate, citing inflationary pressures, high living costs, and elevated operating expenses as major concerns. He emphasized that the timing of the levy imposition could further strain consumer purchasing power, especially for businesses already burdened with various federal taxes and levies.
Of particular concern is the indiscriminate nature of the cybercrime levy, which applies to electronic transactions regardless of a company’s profitability. This could disproportionately affect loss-making companies and economically disadvantaged individuals, raising questions about fairness and equity.
Additionally, Yusuf questioned the proportionality of the levy, pointing out that the potential revenue generated could surpass budget allocations for defence and infrastructure combined. Such disproportionate spending on cybersecurity raises doubts about the necessity and effectiveness of the levy.
In response to these concerns, Yusuf urged relevant authorities to suspend the implementation of the levy and conduct a comprehensive review process. He proposed extensive stakeholder engagement to ensure that the legislation aligns with the interests of businesses, citizens, and investors.
Uche Uwaleke, a professor of Capital Market at Nasarawa State University Keffi, echoed similar sentiments, stating that the cybersecurity levy is ill-timed and could discourage financial intermediation. He called for the withdrawal of the circular and emphasized the need to streamline multiple taxes and levies inhibiting business growth in Nigeria.
Nigerians have also taken to social media to express their concerns about the levy, with many highlighting its potential impact on business owners and entrepreneurs. Some users questioned how the levy would affect different segments of society, particularly the middle class, and called for a reconsideration of the policy in light of existing financial challenges.
Overall, there is a growing call for a reevaluation of the cybersecurity levy to ensure that it does not hinder economic growth or financial inclusion in Nigeria.