FG confirms suspension of the 0.5% Cybersecurity levy

The federal government on Tuesday confirmed the suspension of the 0.5% cybersecurity levy imposed recently by the Central Bank of Nigeria CBN.

The CBN had on May 6, 2024, issued a circular mandating all banks, mobile money operators, and payment service providers to commence the implementation of the new cybersecurity levy.

The levy was part of the Cybercrime (Prohibition, Prevention, etc) (Amendment) Act 2024, which approved that “ a levy amounting to 0.5 per cent of the value of all electronic transactions will be collected and remitted to the National Cybersecurity Fund, overseen by the Office of the National Security Adviser NSA.

But Mohammed Idris, Minister of Information and National Orientation, while briefing State House Journalists, after a marathon meeting of the Federal Executive Council FEC, presided over by President Bola Tinubu, which lasted for two days, confirmed the suspension of the cybersecurity level.

The Minister President Bola Tinubu has asked the Central Bank of Nigeria to suspend the implementation of the controversial cybersecurity levy policy and ordered a review.

The Minister, while fielding questions from Journalists, said “ the matter was discussed at the meeting of FEC” adding that “ the President is not insensitive to the feelings of Nigerians and it was agreed that the policy be suspended while we work out a review of modalities for its implementation”.

Recall that the House of Representatives, had at its last Thursday’s plenary asked the CBN to withdraw its circular directing all banks to commence charging a 0.5 per cent cybersecurity levy on all electronic transactions in the country.

Implementation of the 0.5% cybersecurity levy, as provided for in the Cybersecurity Act 2015, by the Central Bank of Nigeria (CBN), had generated negative reactions from Nigerians, including the Manufacturers, the organised Labour and the Civil Society Organisation, CSO, who appealed to the government to avoid overburdening citizens who were already battling economic hardship.

KPMG, a global firm that provides audit, tax and advisory services, also raised issues with the timing of the 0.5% cybersecurity levy by the federal government.

Many have insisted that the timing for the implementation is wrong given the current economic realities.

Ngozi Okonjo-Iweala, the Director General of the World Trade Organisation WTO, has also urged the federal government to streamline its taxes and levies, arguing that though higher taxes may not be bad, they should not constitute an undue burden on the people.

The Cyber security levy also received the condemnations of the Socio-Economic Rights and Accountability Project (SERAP), joined the BudgIT and other concerned Nigerians filed a lawsuit against the CBN over the implementation of the levy

Members of the Organised Labour, while protesting the policy, noted that it will add more pressures on the already over taxed workers, as the manufacturers will transfer the extra cost of transaction to the consumers.