The Federal Inland Revenue Service (FIRS) begins the trial of Binance, a cryptocurrency exchange platform, over alleged tax evasion. The case is ongoing at the Federal High Court in Abuja, where Binance is accused of failing to collect and remit Value Added Tax (VAT) and Company Income Tax (CIT) as required by Nigerian tax laws......CONTINUE READING THE ARTICLE FROM THE SOURCE>>>>>
During Monday’s hearing, FIRS presents its first witness, Mbami Shomgwan, Manager of the TaxPromax Technology Department. Led in evidence by FIRS counsel Moses Idehu, Shomgwan testifies that Binance provides cryptocurrency trading, remittance, and asset transfer services in Nigeria without fulfilling its tax obligations.
He explains that the TaxPromax system, an automated electronic platform for taxpayer registration and tax collection, records all transactions made by registered taxpayers.
“Any entity operating in Nigeria must be registered on the system to meet its tax obligations,” Shomgwan states. “Without registration, a company cannot file returns, undergo tax assessment, or make necessary payments.”
He further reveals that the TaxPromax system has been operational since June 7, 2021, strengthening FIRS’s claims against Binance.
Binance Denies Allegations
Under cross-examination, Binance’s legal representative, Chukwuka Ikwuazom (SAN), questions whether all companies operating in Nigeria must register for taxation. Shomgwan clarifies that:
Nigerian companies must register regardless of tax liability.
Foreign companies must register only if they have a significant economic presence in Nigeria.
If a foreign company has no economic presence in Nigeria, it is not required to file tax returns or make tax payments.
Following the testimony, the court adjourns the trial to April 11, 2025.
Government’s Case Against Binance
The Nigerian government accuses Binance of influencing foreign exchange rates and engaging in financial misconduct. Minister of Information Mohammed Idris states that Binance records transactions exceeding $20 billion in Nigeria in 2023, leading to increased regulatory scrutiny.
On February 28, 2024, Nigerian authorities detain two Binance executives over allegations of tax evasion, money laundering, and forex violations. One of them, Nadeem Anjarwalla, escapes custody, while the other, Tigran Gambaryan, is later released due to health concerns and diplomatic intervention.
FIRS and the Economic and Financial Crimes Commission (EFCC) continue legal proceedings against Binance, signaling the government’s stricter oversight of cryptocurrency platforms operating in Nigeria.