The Nigerian Economic Summit Group (NESG) has faulted the Central Bank of Nigeria’s (CBN) recent cybersecurity levy, saying it is poorly timed and will hurt the economy.
The chief executive officer, NESG, Dr Tayo Aduloju, who made this known in a statement in Lagos, added that the levy came amid rising inflation and living costs, which would further strain Nigerians.
“Amidst the cost of living crisis exacerbated by rising inflation, 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,” he said.
Aduloju argued that 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, while urging the government to be cautious of the numerous strenuous policies that stiffen the purchasing power and welfare of corporations and individuals.
He advised the government to properly sequence reforms for efficient socioeconomic outcomes, especially those that strain the people, noting that the policy was coming when the Presidential Committee on Fiscal Policy and Tax Reforms was yet to finalise its mandate.
Aduloju said, “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 CEO emphasised that the NESG acknowledged the exemptions highlighted by the CBN, saying however, the CBN needs to be proactive in monitoring banks’ implementation to curb citizen exploitation.
He anticipated that there would still be overlapping transactions even with the exemption provided, noting that it is imperative for the monetary authority to develop an effective and practical framework to limit the levy to liable transactions.
To him, “ It is noteworthy that the policy is intended to fight cybercrimes and raise revenue for the government. However, higher revenue should be achieved without imposing severe burdens on poor and vulnerable Nigerians.
Meanwhile, the policy could also create loopholes for cybercriminals to devise alternative routes to perpetrate the heinous acts.
“To narrow the alternative ways of committing cyber crimes, the NESG posits an integrated approach in the fight against cybercrimes involving the collaborative efforts of financial institutions, security agents, the EFCC and other key stakeholders.”