Legal steps were set in motion by the Federal Government on Monday against Binance, a well-known platform in the area of cryptocurrency trading, for purportedly dodging tax obligations.
Charges were officially filed at the Federal High Court in Abuja by the Federal Inland Revenue Service.
With reference to the lawsuit marked as FHC/ABJ/CR/115/2024, FIRS implicated Binance in four tax evasion charges, underscoring the importance of this measure in upholding fiscal probity and preserving the economic stability of the nation.
Named as the second and third defendants in the lawsuit alongside the cryptocurrency company are Tigran Gambaryan and Nadeem Anjarwalla, who hold senior positions at Binance and are currently detained by the Economic and Financial Crimes Commission.
Among the charges brought against Binance are allegations of neglecting Value-Added Tax payments, Company Income Tax defaults, failure to file tax returns, and purported involvement in assisting customers with tax evasion through its platform.
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In the suit, the Federal Government also accused Binance of failure 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 alleged 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.
Section 40 of the Act explicitly addresses the non-deduction and non-remittance of taxes, prescribing penalties and potential imprisonment for defaulting entities.
The charges further detail specific instances where Binance purportedly violated tax laws, such as failing to issue invoices for VAT purposes, thus obstructing the determination and payment of taxes by subscribers.
“Any company that transacts business in excess of N25 million annually is deemed by the Finance Act to be present in Nigeria.
“According to this rule, Binance falls into that category. So, it has to pay taxes like Company Income Tax (CIT) and also collect and pay Value Added Tax (VAT).
“But Binance did not do this properly. So, the company broke Nigerian laws and could be investigated and taken to court for this infraction,” Adekanmbi said.
FIRS, by the law setting it up and various others, is empowered to assess, collect and account for revenue accruing to the Federation and administer relevant tax laws.
Binance pleaded guilty to flouting anti-money laundering laws in the United States in late 2023, settling for a plea bargain that cost the company $ 4.3 billion.