FG Plans To Raise Billions Through Cybersecurity Levy, Targeting Trillion-Dollar Revenue

FG Plans To Raise Billions Through Cybersecurity Levy, Targeting Trillion-Dollar Revenue

The Centre for the Promotion of Private Enterprise (CPPE) has projected that the Nigerian federal government stands to generate between ₦3 trillion and ₦7.75 trillion annually through its recent imposition of a 0.5% cybersecurity levy on electronic banking transactions. Dr. Muda Yusuf, the Director of CPPE, revealed this estimate in a statement issued on Tuesday, urging for the temporary suspension of the levy due to its adverse impact on Nigerians.

The directive from the Central Bank of Nigeria instructing banks to enforce a 0.5% cybersecurity levy on electronic transactions to be remitted to the office of the National Security Adviser (NSA) was noted. According to CPPE’s analysis, electronic payments processed through the Nigeria Interbank Settlement System (NIBSS) totaled ₦600 trillion in 2023, translating to a potential revenue of ₦3 trillion through the levy.

Yusuf expressed concerns about the timing and scale of the levy, stating, “This is not an opportune moment to burden businesses and citizens with additional charges.” He pointed out that even after considering exemptions provided by law, the potential revenue from the levy remains significant, possibly amounting to ₦7.75 trillion based on industry data from 2022.

Highlighting the disparity between the levy’s projected revenue and allocations for defense, security, and infrastructure in the 2024 budget, Yusuf emphasized the potential consequences for Nigeria’s cashless policy. He cautioned that the legislation could reverse progress made towards cashless transactions, leading to a resurgence in cash reliance among Nigerians. He urged the government to pause implementation and engage in comprehensive consultations.

Yusuf, a former Director General of the Lagos Chambers of Commerce and Industry, underscored the need for a thorough review of the levy’s implications before proceeding further. He appealed to relevant authorities to reconsider the implementation of the legislation to prevent adverse effects on the economy and financial ecosystem.

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