FG Initiates Criminal Proceedings Against Binance for Alleged Tax Evasion

The Federal Government of Nigeria has filed criminal charges against Binance, a prominent cryptocurrency exchange platform, for alleged tax evasion.

The lawsuit, which was filed at the Federal High Court in Abuja, also implicates two senior executives of Binance, Tigran Gambaryan and Nadeem Anjarwalla, who are currently under the custody of the Economic and Financial Crimes Commission (EFCC).

The four-count tax evasion accusation against Binance includes non-payment of Value-Added Tax (VAT), Company Income Tax, failure to file tax returns, and complicity in aiding customers to evade taxes through its platform.

The Federal Government has accused the company of not registering with the Federal Inland Revenue Service (FIRS) for tax purposes and contravening existing tax regulations within the country.

The charges also state that Binance failed to collect and remit various categories of taxes to the federation as stipulated by Section 40 of the FIRS Establishment Act 2007 as amended.

This section addresses the non-deduction and non-remittance of taxes, prescribing penalties and potential imprisonment for defaulting entities.

The Federal Government has maintained its stance on ensuring compliance with tax regulations and combating financial impropriety within the cryptocurrency sector.

According to the government, any company that transacts business in excess of N25 million annually is deemed by the Finance Act to be present in Nigeria, and therefore, must pay taxes like Company Income Tax (CIT) and also collect and pay Value Added Tax (VAT).

Binance, however, is accused of not complying with these tax laws, such as failing to issue invoices for VAT purposes, thus obstructing the determination and payment of taxes by subscribers.

As the legal proceedings unfold, the outcome of this case could have far-reaching implications for the cryptocurrency industry in Nigeria and beyond.

It remains to be seen whether Binance will face penalties for the alleged tax evasion, and if so, to what extent.