PREMIUM TIMES
President Tinubu has directed that the implementation of the Cybersecurity Levy should be suspended. This is a welcome development. It makes the people happy. It shows that the government has listened to the yearnings of the people. This is a habit that the Tinubu administration should cultivate: to restore hope, and avoid anti-people policies. The CBN is yet to withdraw its circular on the Cybersecurity Levy. It must do so forthwith, otherwise the banks would insist that they have not received any counter-directive from the regulator.
The report that President Bola Tinubu has now ordered the Central Bank of Nigeria (CBN) to suspend the implementation of the proposed Cybersecurity Levy must come to many Nigerians as some sort of relief, but before we deal with the sense or non-sense of the levy itself, where does this leave the autonomy of the CBN? The Presidency has tried to walk back the narrative by saying that the directive is to the Office of the National Security Adviser (ONSA), and not the CBN, but come off it, it is the CBN that gave a directive to the banks, the ONSA is to manage the fund, and receive 40 per cent of whatever is collected by the CBN. It is therefore not surprising that many civil society groups and experts have raised questions about the law, the process, and the policy. These include the Nigerian Labour Congress (NLC), the Trade Union Congress (TUC), Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), KPMG, Afenifere, Northern Elders Forum, Coalition of Northern Groups, Centre for the Promotion of Private Enterprise (CIPPE), BudgIT, SERAP and others. The CBN directive is based on Section 44 (2) of the Cybercrime Prevention and Prohibition Act of 2024, itself an amendment of the same law of 2015.
Femi Falana (SAN), in an informed opinion, has raised the point that the CBN misinterpreted the law, and that the Act itself is contradictory. His specific reference is to the fact that the CBN wrongly directed all financial institutions to apply the levy at the point of origination of electronic transfer, and to be so explicitly noted in customer accounts under the description ‘Cybersecurity Levy’ and remitted to the CBN. Falana argues that the erroneous impression has been created that the levy is payable by individual customers using the services of commercial banks, payment system banks, non-interest banks, merchant banks, mobile money operators, and payment service providers. The phrase “businesses” in the 2015 Act has been substituted for “business” in the 2024 amendment, and there is confusion as to whether the levy is 0.005 per cent or 0.5 per cent. He argues further that the CBN owes Nigerians an apology for the misleading interpretation of the clear and unambiguous provisions of the Act to wit: Section 42(a) makes it clear that the levy shall be applicable to GSM providers, Internet service providers, banks and other financial institutions, insurance companies and the Nigerian Stock Exchange.
Falana’s position was subsequently on all fours with the decision of the House of Representatives that the implementation of the levy should be suspended because, as Hon Kingsley Chinda put it, it contradicts the Second Schedule of the Act. Last Thursday, Hon Chinda, representing Obio/Akpor Constituency, moved a motion for the immediate halt and modification of the levy announced by the CBN on 6 May. The House concurred, and so resolved. However, the Senate, speaking through Senator Shehu Umar Buba, chair of the Senate Committee on National Security and Intelligence, argued that the CBN circular is in line with the Act, as amended, and that there are exemptions duly stated in the law. These exemptions, 16 in all, are listed in the appendix to the CBN circular, but what we see is apparent confusion, even among the lawmakers, despite the fact that the best way to know the value of any law is through its implementation. This is one clear instance in which the implementation of a law has been subjected to a rigorous test and robust opinion by those it is meant to serve. The law has raised a number of interesting questions that should serve as necessary guide: Can public institutions be funded directly by bank deposits, with the CBN as a collecting agent? Can the Office of the National Security Adviser receive unappropriated funding for its activities? Since banks already charge fees for electronic transfers, does the electronic transfer levy for cybercrime protection not amount to double taxation? Should ONSA be a revenue collecting agency? And how do we reconcile the obvious confusion in the law?
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