By Tony Obiechina, Abuja
Amidst negative reactions trailing the recent introduction of the cyber security levy by the Central Bank of Nigeria (CBN), the Nigeria Economic Summit Group (NESG), has taken a different approach to the issue.
The NESG said in a statement on Thursday that given the cost of living crisis exacerbated by rising inflation in the country, the cybersecurity levy is mistimed, considering CBN’s concern about the high rate of financial exclusion and increased currency in circulation.
“The NESG posits that the levy should be targeted at high-net-worth individuals and a specific amount transferred electronically to allay the fears of the populace, who are still battling skyrocketing food and non-food prices.
“However, if this policy remains, several Nigerians will boycott electronic funds transfers, which does not even bode well for the government due to revenue loss from electronic transfer levy.
“The NESG, however, feels this is a critical time to implement such a policy. The impacts of the fuel subsidy removal, exchange rate reform, and, most recently, the removal of electricity subsidies still permeate the operating costs of businesses and citizens’ welfare”, it noted.
According to the Group, the government must be cautious of the numerous strenuous policies that stiffen the purchasing power and welfare of corporations and individuals, and “needs to properly sequence reforms for efficient socioeconomic outcomes, especially those that strain the people”.
It pointed out that although the policy is coming when the Presidential Committee on Fiscal Policy and Tax Reforms is yet to finalise its mandate, one of the terms of reference of the Committee is that the number of taxes should be streamlined. Introducing a cybersecurity levy could thwart this essential mandate.
“To avoid conflict of interests and ensure no policy misalignment, the NESG strongly believes that the levy should be deferred and proper consultation until the Fiscal Policy Committee deems it necessary to implement it.
“The NESG recognises the exemptions highlighted by the CBN. However, the CBN needs to be proactive in monitoring banks’ implementation to curb citizen exploitation. With the exemption provided, we anticipate that there will still be overlapping transactions. Therefore, it is imperative for the monetary authority to develop an effective and practical framework to limit the levy to liable transactions”. READ ALSO:
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The NESG said although the policy is intended to fight cybercrimes and raise revenue for the government, higher revenue should be achieved without imposing severe burden on poor and vulnerable Nigerians, noting that the policy could also create loopholes for cybercriminals to devise alternative routes to perpetrate the heinous acts.
While acknowledging the imperative of enhancing cybersecurity resilience, the NESG urged prudent consideration of the cybersecurity levy’s timing and implementation modalities, stressing that by fostering dialogue, targeted application, and comprehensive cybersecurity strategies, Nigeria can navigate the evolving cyber threat landscape while safeguarding economic stability and promoting inclusive growth.
