From Cyriacus Nnaji, Lagos
Digital Assets Coalition, a group representing digital-asset participants and operators in Nigeria, has warned that Nigeria’s $92 billion virtual asset market, built overwhelmingly by young Nigerians and now the largest in Sub-Saharan Africa, risks being driven offshore by the new guidelines on the Taxation of Virtual Assets.
The group gave the warning at a press conference at L’eola Hotel, Maryland, Ikeja, Lagos, on Thursday.
The Coalition, at the briefing opened its position in a paper, titled “Tax the Profit, Not the Movement of Money”, with an unambiguous statement of support for taxation. It backed taxing real gains, registering platforms, verifying customers, and requiring full transaction reporting, in line with the standards of the United Kingdom, South Africa, and Brazil.
The Coalition however, objected to the charges on the gross movement of money rather than on any profit earned. The first, according to it, is a 1.5% stamp duty on every conversion between naira and digital assets, never refunded and charged whether a person gains or loses. The second is a 1% withholding deducted from the entire value of every sale, even where the seller made a loss.
A third concern is the requirement to remit taxes in tokens, which is inconsistent with the Nigeria Tax Administration Act, 2025, whose Section 39 mandates payment in currency.
Obinna Iwuno, Spokesperson of the Digital Assets Coalition said, “We support the taxation of virtual assets without qualification. “Our concern is with a design choice that taxes the movement of money itself.
This charge falls on a remittance to a student abroad, on a freelancer converting earnings already taxed as income, and on a trader in a year they lost money. That is not a tax on profit. It is a toll on participation.”
He said the burden falls hardest on the young Nigerians who built the market as working infrastructure for global earnings, family remittances, and savings that survive Naira volatility. Because young users transact small and often, the levies compound fastest against their pattern of use. They bite even below the ₦10 million threshold the Nigeria Tax Act itself exempts and within the ₦800,000 income band taxed at zero, while filing burdens can exceed a student’s entire earnings.
Speaking further he said, “The framework is anti-youth in effect, even if not in intent. You cannot tax your way into the future by taxing the people building it,” Iwuno said.
He added that every comparable country has reversed course. India’s 1% transaction withholding saw regulated exchanges lose 81% of volume within four months, with over 90% of trading moving offshore within a year, according to the Esya Centre. Kenya repealed its 3% transaction tax in 2025, and Turkey withdrew a similar levy in 2026.
