“Potential Imprisonment for Defaulting”: FG Charges Binance for Tax Evasion, Others

“Potential Imprisonment for Defaulting”: FG Charges Binance for Tax Evasion, Others

  • The Federal Inland Revenue Service has filed criminal charges against Binance, a cryptocurrency exchange platform
  • According to the FIRS, the charges are based on failing to file tax returns and not paying company income tax (CIT)
  • Similarly, the exchange was charged for evading value-added tax (VAT) and aiding customer tax evasion

Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.

Binance cryptocurrency exchange has been criminally charged by the Federal Inland Revenue Service (FIRS).

FG Charges Tax Crimes Against Binance
Four different tax crimes are alleged against Binance. Photo credit: Binance, FG
Source: UGC

Four different tax crimes are alleged against Binance in the action, which was filed at the Federal High Court in Abuja under case number FHC/ABJ/CR/115/2024.

According to The Nation report, these consist of failing to file tax returns, not paying company income tax (CIT), evading value-added tax (VAT), and aiding customer tax evasion.

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Binance's platform facilitated customers' tax avoidance, according to the FIRS.

Exchange broke tax law

The FIRS claimed in a statement that Binance had broken current Nigerian tax laws beyond just the registration issue.

It stated:

"The Federal Government also accused Binance of failure to register with FIRS for tax purposes and contravening existing tax regulations within the country.
“One of the counts in the lawsuit pertains to Binance’s alleged failure to collect and remit various categories of taxes to the federation as stipulated by Section 40 of the FIRS Establishment Act 2007 as amended.
“Section 40 of the Act explicitly addresses the non-deduction and non-remittance of taxes, prescribing penalties and potential imprisonment for defaulting entities”.

Failure to register for tax

The FIRS specifically charged Binance with failing to register for taxes.

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A separate complaint in the lawsuit asserts that Binance's activities breached established tax laws in Nigeria and that Binance failed to register with the FIRS as required by law.

The second and third defendants in the case were identified as top Binance executives Tigran Gambaryan and Nadeem Anjarwalla, who are under the jurisdiction of the Economic and Financial Crimes Commission (EFCC).

The FIRS also reaffirmed its dedication to implementing tax laws and combating financial malpractice in the bitcoin industry.

Earlier charges against Binance

The legal action ensues from Binance's guilty plea in late 2023 for breaking US anti-money laundering regulations.

The corporation paid a $4.3 billion fine as part of a plea deal to resolve the charges.

This lawsuit marks a significant advancement in Nigerian cryptocurrency regulation.

Binance, others face billions of dollars in fines

Legit.ng reported that the Securities and Exchange Commission (SEC) might slam substantial fines running into billions of dollars on Binance, the world's largest cryptocurrency exchange and others operating in Nigeria.

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SEC and other security operatives are investigating allegations of currency manipulations against the Nigerian currency by Binance and other crypto platforms.

The development allegedly contributed to the current foreign exchange crisis in Nigeria.

Source: Legit.ng

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