The federal government has officially announced the suspension of the 0.5% cybersecurity levy recently imposed by the Central Bank of Nigeria (CBN). This decision comes after widespread public outcry and negative reactions from various stakeholders, including Nigerians, manufacturers, organized labor, and civil society organizations (CSOs), who expressed concerns about the levy’s potential to overburden citizens already facing economic challenges.
The Cybersecurity Levy, as mandated by the Cybercrime (Prohibition, Prevention, etc) (Amendment) Act 2024, required all banks, mobile money operators, and payment service providers to implement a levy amounting to 0.5% of the value of all electronic transactions. The funds collected were intended to be remitted to the National Cybersecurity Fund, overseen by the Office of the National Security Adviser (NSA).
However, following discussions at a two-day marathon meeting of the Federal Executive Council (FEC) presided over by President Bola Tinubu, Minister Mohammed Idris confirmed the suspension of the levy. President Tinubu has directed the CBN to suspend the implementation of the controversial policy and conduct a comprehensive review of its modalities.
Addressing journalists after the FEC meeting, Minister Idris emphasized that the President is sensitive to the concerns of Nigerians and recognizes the need to reconsider the policy’s impact. He stated that the decision to suspend the Cybersecurity levy was reached in light of public sentiment and the need for a thorough reassessment.
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The House of Representatives had previously called for the withdrawal of the CBN circular directing banks to implement the 0.5% cybersecurity levy on all electronic transactions. This move was met with support from various quarters, including global firms like KPMG, which raised concerns about the timing of the levy given the current economic realities.
Ngozi Okonjo-Iweala, Director-General of the World Trade Organization (WTO), also weighed in on the issue, urging the federal government to streamline its taxes and levies to avoid imposing undue burdens on the populace. The Cybersecurity levy faced condemnation from organizations such as the Socio-Economic Rights and Accountability Project (SERAP), which filed a lawsuit against the CBN over its implementation.
Members of organized labor voiced their opposition to the policy, highlighting concerns that it would further strain overtaxed workers. They argued that manufacturers would pass on the additional transaction costs to consumers, thereby increasing the financial burden on ordinary citizens.
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In light of these developments, the federal government has taken decisive action to suspend the implementation of the Cybersecurity Fee pending a review of its modalities. This decision reflects a commitment to responsive governance and the importance of addressing public concerns in policy formulation processes.
Stakeholders are hopeful that the government will engage in meaningful dialogue and consultation to ensure that any future cybersecurity initiatives are implemented in a manner that is fair, transparent, and considerate of the needs of all Nigerians.