Nigeria demands $81 billion from Binance in unprecedented tax and penalty blitz

Nigeria’s Federal Inland Revenue Service (FIRS) has taken legal action against Binance Holdings Limited, demanding over $81 billion in unpaid taxes and penalties.

On Nov. 19, local media outlet Nairametrics reported that this claim includes $79.5 billion in economic damages and an additional N231 million ($153,223) tied to Binance’s operations. The tax authority also seeks nearly $2 billion in outstanding income tax for 2022 and 2023.

Binance has yet to respond to CryptoSlate’s request for comment.

Meanwhile, this demand significantly surpasses the $4.3 billion penalty Binance paid to U.S. regulators last year. If enforced, it would mark the most significant financial penalty ever imposed on a crypto firm by a national government.

Nigeria’s case against Binance

FIRS argues that Binance failed to disclose its business activities in Nigeria while benefiting from its vast user base.

The agency claims the exchange violated the Companies Income Tax (CIT) Act and the Significant Economic Presence (SEP) Order. The SEP Order applies to foreign firms earning at least N25 million ($30,000) annually from Nigerian customers.

According to FIRS, Binance generated $35.4 million in net revenue from a trade volume of $21.6 billion in 2023.

The tax claim also includes a 10% penalty for tax evasion and a 26.75% interest charge from Jan. 1, 2023, to Jan. 1, 2024.

The authorities alleged that Binance operated unauthorized financial services and failed to comply with anti-money laundering regulations, causing economic harm to Nigeria.

This lawsuit is part of Nigeria’s broader crackdown on Binance. It follows the withdrawal of previous charges against Binance executive Tigran Gambaryan, who has since accused Nigerian officials of corruption.

Gambaryan claims that authorities deliberately targeted Binance to divert attention from internal economic challenges. However, the Nigerian government has described his accusations as false and baseless.

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