The Nigerian government has leveled tax evasion charges against the cryptocurrency firm Binance.
Announced by the Federal Inland Revenue Service (FIRS) on Monday, the charges were filed at the Federal High Court in Abuja under the case number FHC/ABJ/CR/115/2024, accusing Binance of four counts of tax evasion.
The suit also names Tigran Gambaryan and Nadeem Anjarwalla, senior Binance executives, as the second and third defendants, both of whom are currently detained by the Economic and Financial Crimes Commission (EFCC).
The allegations against Binance include the non-payment of Value-Added Tax (VAT), Company Income Tax, failure to file tax returns, and facilitating tax evasion for customers via its platform.
Furthermore, the Federal Government accuses Binance of neglecting to register with FIRS for tax purposes and contravening existing tax regulations within the country.
One of the counts in the lawsuit pertains to Binance’s purported failure to collect and remit various categories of taxes to the federation, as stipulated by Section 40 of the FIRS Establishment Act 2007 as amended.
This section explicitly addresses the non-deduction and non-remittance of taxes, prescribing penalties and potential imprisonment for defaulting entities.
The charges outline specific instances where Binance allegedly violated tax laws, such as the failure to issue invoices for VAT purposes, thereby impeding the determination and payment of taxes by subscribers.
“Any company that conducts business exceeding N25 million annually is deemed, by the Finance Act, to be present in Nigeria,” the FIRS noted in a statement.
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“According to this rule, Binance falls into that category. So, it is obligated to pay taxes like Company Income Tax (CIT) and also collect and remit Value Added Tax (VAT). However, Binance did not adhere to these requirements, thus violating Nigerian laws and potentially facing investigation and legal action for this infraction.”
The Federal Government says it remains steadfast in its commitment to ensuring compliance with tax regulations and combating financial impropriety within the cryptocurrency sector.
By law, FIRS is empowered to assess, collect, and account for revenue accruing to the Federation and administer relevant tax laws.
Binance previously pleaded guilty to violating anti-money laundering laws in the United States in late 2023, reaching a plea bargain agreement that resulted in the company paying a hefty fine of $4.3 billion.
This comes after Nadeem Anjarwalla, one of the two Binance executives detained in Nigeria escaped from custody.
