FG Charges Binance with Tax Evasion

The Federal Government has taken a significant step to ensure fiscal responsibility and protect the economic integrity of the nation by initiating legal action against Binance, a well-known cryptocurrency exchange platform.

The charges were officially filed at the Federal High Court in Abuja and were announced by the Federal Inland Revenue Service (FIRS) on Monday. The lawsuit, identified as suit number FHC/ABJ/CR/115/2024, accuses Binance of four counts of tax evasion.

Tigran Gambaryan and Nadeem Anjarwalla, senior executives of Binance, are also named as defendants in the suit and are currently in custody under the Economic and Financial Crimes Commission (EFCC).

The charges against Binance include allegations of non-payment of Value-Added Tax (VAT), Company Income Tax, failure to file tax returns, and facilitating tax evasion by its customers through its platform.

, the Federal Government accuses Binance of failing to register with FIRS for tax purposes and violating existing tax regulations in the country. One of the counts in the lawsuit specifically addresses Binance’s alleged failure to collect and remit various types of taxes as required by Section 40 of the FIRS Establishment Act 2007, which outlines penalties and potential imprisonment for entities that fail to comply with tax obligations.

The allegations detail specific occasions where Binance supposedly breached tax regulations, such as the absence of issuing invoices for VAT purposes, hindering the calculation and settlement of taxes by customers.

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The Federal Inland Revenue Service (FIRS) emphasized that any business with an annual turnover exceeding N25 million is considered to be operating in Nigeria according to the Finance Act.

Binance is classified under this provision and is therefore required to pay taxes like Company Income Tax (CIT) and also collect and remit Value Added Tax (VAT), which the company failed to comply with, resulting in a violation of Nigerian laws and potential legal consequences.

The government reiterates its dedication to enforcing tax regulations and combating financial misconduct in the cryptocurrency industry.

FIRS is mandated by law to evaluate, collect, and report revenue to the Federation and enforce relevant tax statutes.

Binance had previously admitted to breaching anti-money laundering laws in the United States in late 2023, leading to a plea deal where the company paid a substantial fine of $4.3 billion.