Nigerian Government Comes For Crypto And Forex Traders With New Tax Law

Dear cryptocurrency trader, The Nigerian government is coming for you as the regulatory taxman. FIRS will start taxing your earnings and income from crypto trading.

I know you will be wondering, “How?

Ok, bring your seat; let me explain it for you.

Before he left office, our former president, Muhammed Buhari, signed into law what is called the Finance Bill 2023, which became law on May 1, 2023.

Nigeria is broke; that is stale news, so the government is looking for creative avenues to generate income, and that is where the new cryptocurrency tax comes in.

More often than not, successful crypto traders tend to share their wins online.

I’m sure you have come across these phrases:

How Bitcoin changed my life

I was broke before a friend introduced me to crypto.

I made $100,000 trading Ribbit meme coins; you can do so too.

These are farmilar lingos, or languages, normally associated with successful crypto traders, but the difference this time around is that the tax man on Facebook is on the lookout for such bragging rights, and they will come after you as you are owing the Nigerian government tax from the income you made trading meme coins.

Cryptocurrency tax falls under capital gain tax, and let me explain how it works.

Let’s say I made $100,000 in profit from a shitcoin called Pepe and then came online to brag about it.

After the bragging, FIRS will call me to come to their office in Ikoyi, as I owe the Nigerian government $10,000 from the $100,000 made trading pepe.

In a nutshell. Profits gained from the sale of digital assets, including Bitcoin, meme tokens, low-quality coins, and Ponzi tokens, will now be subject to a 10% tax.

This is not where it ends, my brother.

It is a well-known fact and public knowledge that most cryptocurrency traders who started trading crypto from 2021 until today have made more losses than gains.

Crypto is a risky and volatile asset class, so it is expected.

With this knowledge in mind, the taxman has made it easy for you to carry your losses forward.

Let me explain. Let’s say I invested 2 million naira in Pepe at the height of the coin when it peaked to its all-time high. You know, FOMO (fear of missing out in human beings) is real, but Pepe’s price has deaccelerated, meaning that my 2 million naira is now 400,000.

However, I made 400,000 trading Floki, another meme coin.

I can file with FIRS that I made a loss of 1 million, 600 thousand naira from Pepe, and so the 400k I made from Floki is not enough for me to pay tax to the Nigerian government, so I am permitted by law to declare a loss under capital losses and then carry it forward next year, hoping to make that final breakthrough, to hammer like the pioneer traders who started trading crypto before 2020 have done.

This means that being a terrible, unsuccessful trader has its advantages, as the Nigerian government empathizes with you and has your back while rooting for you and reminding you that you got this.

“As long as the sun revolves, your turn will come.”

Finally, the tax doesn’t get charged until you actually sell your crypto token on Binance and then realize a gain or loss.

So, if you’re fond of posting your crypto profit online or regaling us with stories of how Bitcoin changed your life, be sure to calculate your 10% tax too, because tax evasion carries a sentence of 3 years in Nigeria.

I’m not sure you want to go from that successful Bitcoin trader who drives a Rolls Royce to the guy who is now an inmate of Kirkiri Prison because he did not pay his tax.

But more than anything, the Nigerian government has ended the debate over whether crypto is a ponzi project or not.

I’m sure you know that no serious government wants to tax a Ponzi project, but more importantly,with a stroke of the pen, the Nigerian government has legitimized cryptocurrency in Nigeria, so crypto is no longer illegal as CBN wanted you to believe.

I have been waiting all my life for a time like this.