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, with industry leaders expressing worries about its potential economic impact.
Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), has raised serious concerns about the directive, highlighting the challenges faced by businesses and citizens in the current economic climate. He pointed out issues such as inflationary pressures, high living costs, and elevated operating expenses as major concerns.
Yusuf also questioned the timing of the levy imposition, noting the strain it would put on businesses already burdened with various federal taxes and levies. He emphasized that even loss-making companies and economically disadvantaged individuals would feel the impact of this levy, raising questions about fairness and equity.
Additionally, Yusuf expressed doubts about the proportionality of the levy, suggesting that the potential revenue generated could surpass budget allocations for defence and infrastructure combined. Such disproportionate spending on cybersecurity raises concerns about the necessity and effectiveness of the levy.
In response to these concerns, Yusuf called for a suspension of the levy implementation and proposed a comprehensive review process with extensive stakeholder engagement to ensure alignment with the interests of businesses, citizens, and investors.
Uche Uwaleke, a professor of Capital Market at Nasarawa State University Keffi, echoed similar sentiments, describing the cybersecurity levy as ill-timed and potentially detrimental to financial intermediation and monetary policy transmission.
Nigerians have taken to social media to express their worries about the levy, with many highlighting its potential impact on business owners and entrepreneurs dealing with large transaction volumes daily. Some have raised concerns about its impact on the middle class, questioning the necessity of such a levy during challenging economic times.
Overall, there is a call for a reevaluation of the cybersecurity levy to ensure that it does not hinder financial inclusion or impede economic growth in Nigeria.