The Federal Government of Nigeria has filed a lawsuit against Binance, a prominent cryptocurrency exchange platform in the Federal High Court Abuja over charges of tax evasion by the company.
The lawsuit with suit number FHC/ABJ/CR/115/2024, accuses Binance of a four-count charge all bordering on tax evasion.
Respondents to the suit alongside the crypto company as second and third defendants are Tigran Gambaryan and Nadeem Anjarwalla, both senior executives of Binance currently in the custody of the Economic and Financial Crimes Commission (EFCC).
Dare Adekanmbi, The Special Adviser (Media) to the Executive Chairman of the Federal Inland Revenue Service (FIRS) had on Monday issued a statement saying that the charges levied against Binance include non-payment of Value-Added Tax (VAT), Company Income Tax, failure to file tax returns, and complicity in aiding customers to evade taxes through its platform.
The claims made by the Federal Government include Binance’s failure to register with FIRS for tax purposes and contravening existing tax regulations within the country.
Among the counts in the lawsuit is 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 which also addresses the non-deduction and non-remittance of taxes, prescribing penalties, and potential imprisonment for entities found in breach.
The charges also explain specific instances where Binance purportedly violated tax laws, such as failing to issue invoices for VAT purposes, thereby obstructing the determination and payment of taxes by subscribers.
Adekanmbi said, “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.”
Binance in 2023 had lost $4.3 billion to the United States Government in a plea bargain after pleading guilty to flouting anti-money laundering laws in the United States.
