NRS Crypto Tax Guidelines: Coalition Wants Transaction Charges Removed, Profit-Based Tax Adopted

The Digital Assets Coalition (DAC) has asked the Nigeria Revenue Service (NRS) to reconsider its proposed taxation guidelines for virtual assets, warning that taxing every transaction could push crypto users underground and cut government revenue. In a newly released position paper, the coalition said it supports taxation of profits from crypto investments, but opposes charges on every transaction regardless of gains or losses.

Coalition rejects transaction-based charges

DAC's main objections are the proposed 1.5% stamp duty on every conversion between naira and digital assets, and the 1% withholding tax on the total value of crypto sales. The group argued that these charges apply even when investors suffer losses or simply transfer funds without making any profit. It warned that transaction costs could exceed exchange fees by several times, making regulated Nigerian platforms less attractive than offshore alternatives.

According to the coalition, the framework would affect more than crypto traders. Families sending money abroad, small importers paying overseas suppliers, freelancers receiving payments in stablecoins, and students earning modest crypto rewards could face taxes on remittances, business payments, and income that has already been taxed, along with added compliance requirements.

International lessons and recommendations

DAC pointed to international examples, saying similar transaction-based crypto taxes in India, Kenya, and Turkey either failed to generate expected revenue or were repealed after driving trading activity to offshore platforms. It argued that countries such as the United Kingdom, South Africa, and Brazil focus on taxing investment gains rather than the movement of digital assets.

The coalition called on the NRS to postpone implementation of the guidelines, hold wider stakeholder consultations, remove taxes on crypto transactions, collect taxes only in naira, protect small users through exemptions, and retain registration and reporting obligations for exchanges. It maintained that a profit-based tax regime would raise more sustainable revenue, improve compliance, and keep Nigeria's growing crypto sector within the formal economy.

NRS timeline and TIN requirement

The NRS published the Guidelines on the Taxation of Virtual Assets on Monday, August 3. The rules cover cryptocurrencies, stablecoins, tokenised assets, and other digital assets. Under the new framework, crypto exchanges, wallet providers, trading platforms, and peer-to-peer escrow operators must confirm a customer's Tax Identification Number before that account can go live.

For Nigerian businesses and crypto users, the outcome of this review matters. A transaction-based tax could raise costs for everyday users and drive activity offshore, while a profit-based system would give the government revenue without punishing legitimate use of digital assets.