The recently introduced 0.5 per cent cyber security levy by the Central Bank of Nigeria has created an uproar among Nigerians.
The Central Bank of Nigeria, in a notice to all banks on Monday, directed them to deduct and remit 0.5% levy on all electronic transactions by Cybercrimes (prohibition, prevention, etc.) (Amendment) Act, 2024.
In this report, IT highlights things Nigerians should know about the new legislation.
Cyber security levy
The levy is 0.5 per cent on all electronic transactions, not 0.005 per cent.
The levy is to be implemented by all Banks, Other Financial Institutions and payment service providers.
CBN stated that the levy should be remitted to the National Cybersecurity Fund, NCF, administered by the Office of the National Security Adviser, ONSA.
What is the implication of the Cybersecurity levy?
This means that electronic banking channel users in Nigeria will incur 0.5 per cent per transaction. For instance, an electronic transaction of N1,000 will incur N5 cybersecurity levy, and a N10 million transaction will incur a N50,000 charge.
Transactions exempted from Cybersecurity levy
There are several transactions exempted from the cybersecurity levy.
The Central Bank of Nigeria attached 16 transactions that are exempted from the levy, including loan disbursements and repayment, salary payments, intra-account transfers within the same bank or between different banks for the same customer, other Financial Institutions instructions to their correspondent, banks Interbank placements, Banks’ transfers to CBN and vice-versa, Inter-branch transfers within a bank, Cheques clearing and settlements and others.
Call for Suspension of Cybersecurity Levy
The Centre for the Promotion of Private Enterprise and the Nigeria Labour Union has called for a suspension of the levy.
In a statement by CPPE Director, Dr Muda Yusuf, he said Nigerians are already grappling with multiple taxes; hence, the additional burden will be insensitive.
On his part, NLC president, Joe Ajaero also called for the reversal of the levy.
He noted that imposing such a levy on electronic transactions without considering its implications on workers and vulnerable segments of society is unjustifiable.
