LCCI calls for withdrawal of CBN cybersecurity levy

The Lagos Chamber of Commerce and Industry (LCCI) is advocating for the withdrawal of the Central Bank of Nigeria (CBN) cybersecurity levy, citing the need for more consultation with stakeholders. The Chamber is also urging the government to focus on amending laws to reflect current realities and harmonize tax initiatives across various government agencies. Gabriel Idahosa, President of the Lagos Chamber of Commerce and Industry, highlighted key concerns and feedback from the business community regarding the increasing number of levies imposed by government agencies. One major issue raised is the proliferation of levies by various federal agencies, adding to the burden faced by corporate bodies already paying significant amounts in income tax, education tax, and value-added tax. The lack of coordination among government entities when introducing new levies has become a pressing concern among business stakeholders. Idahosa emphasized the importance of government agencies understanding the cumulative impact of multiple levies on taxpayers and called for better coordination in introducing such financial obligations. Another specific concern raised by the LCCI is the cybersecurity levy itself. Idahosa argued that cybersecurity is primarily a security issue and should not require a separate levy, as existing levies such as the police trust levy and information technology levy already cover related aspects. The proposed rate of 0.5% for the cybersecurity levy was deemed excessively high, especially considering the volume of transactions affected. Suggestions have been made to either cap the levy amount or set a nominal fee for transaction tracking purposes. Idahosa pointed out that countries like South Africa, which collect more revenue as a percentage of GDP, have fewer tax categories and emphasized the need for efficient tax collection to support various sectors like education, healthcare, and cybersecurity. The LCCI President stressed the importance of focusing on improving tax collection capacity through existing channels rather than burdening taxpayers with additional levies. Only 40% of eligible taxpayers are currently paying taxes in Nigeria, necessitating a strategic approach to revenue generation. Idahosa reiterated that the primary goal of the cybersecurity levy should be to strengthen cybersecurity capabilities, with funding sourced from regular budget allocations instead of standalone levies. The interview highlighted the significance of considering the broader implications of tax initiatives on businesses and the economy, especially during times of regulatory reforms. The call for greater stakeholder engagement and a more streamlined approach to levies reflects the LCCI's commitment to promoting a conducive business environment in Nigeria. Amidst evolving regulatory landscapes, collaboration between the government and the private sector is crucial for sustainable economic growth and development.