The Federal Inland Revenue Service (FIRS) has accused Binance of having a significant economic presence in Nigeria, making it liable for corporate income tax. The tax authority is seeking a court declaration mandating Binance to pay its outstanding corporate income taxes for 2022 and 2023, along with penalties for non-compliance. As part of the lawsuit, FIRS is demanding a 10% annual penalty on unpaid amounts and an interest rate of 26.75%, which aligns with the Central Bank of Nigeria’s lending rate.
Binance has been under increasing regulatory scrutiny in Nigeria, particularly after the government launched a crackdown on the cryptocurrency industry last year. The exchange is already facing four separate counts of tax evasion, including failure to pay value-added tax (VAT) and company income tax, non-filing of tax returns, and complicity in helping customers evade taxes through its platform. These allegations form part of the Nigerian government’s broader efforts to enforce tax compliance among digital asset companies operating within the country.
Despite contesting the charges, Binance has taken steps to limit its exposure to regulatory actions in Nigeria. In March last year, the company announced it was suspending all transactions and trading activities involving the naira, signaling a retreat from the Nigerian market.
Beyond the tax evasion case, Binance is also facing separate money laundering charges brought forward by Nigeria’s anti-graft agency, further complicating its legal battles in the country. As authorities tighten regulations on digital finance, the outcome of these legal proceedings could set a precedent for how cryptocurrency exchanges operate within Nigeria’s financial ecosystem.
