• NASME, other stakeholders express divergent opinions
From Fred Itua and Ndubuisi Orji, Abuja
The Senate and the House of Representatives have taken divergent position on the proposed implementation of the cybersecurity levy.
While the upper chamber gave it a nod at plenary yesterday, the House of Representatives urged the Central Bank of Nigeria (CBN) to halt its implementation.
This is as both chambers have come under fire over their roles in the passage of the Act, despite the biting economic hardship.
Both chambers passed the amendment, Cybercrimes (Prohibition, Prevention, etc) Act. No. 17, 2015, where they imposed the levy on Nigerians.
In the new amendment signed into law and tagged ‘Cybercrime Act 2024’, the National Assembly, despite the current tax burdens on Nigerians, imposed the new Cybersecurity levy.
Defending the Move, the Senate, through its Committee on National Security and Intelligence, claimed that the new levy will protect Nigeria’s cyber space.
It further claimed that public hearings were held were Nigerians made their contributions before the amendment bill was passed into law by the two chambers of the National Assembly.
“It is on record that the current Cybercrime Act 2024 amends the Cybercrimes (Prohibition, Prevention, etc) Act.No. 17, 2015 to correct some consequential words that were inadvertently omitted in the Act, most specifically, Section 44 of the Principal Act as amended where the ambiguity on the said levy was demystified thereby putting it “a levy of 0.5% (0.005) equivalent to a half percent of all electronics transactions value by the business specified in the Second Schedule to this Act,” Shehu Buba Umar, chairman of the Committee in a statement released late Thursday night, claimed.
Umar added: “It is urgently imperative to fund the security of Nigeria’s Critical National Information Infrastructure (CNII), counter-terrorism and violent extremism, strengthen National Security and protect digital economic interests, and fully implement the National Cybersecurity Programme through the operationalisation of the National Cybersecurity Fund by all regulators and businesses specified in the Act.
“I am confident that judicious use of cybersecurity levy will enhance the Nation’s capability to assess, implement, update and advance the security of national critical economic infrastructure and protect the Nation’s cyberspace across all cybersecurity domains.
“The protection, security, and sustainability of Nigeria’s active engagement in cyberspace depends on the readiness to fund and diversify the cybersecurity engagement roadmap envisioned by the current administration and the support of my colleagues at the National Assembly.
“It is on record that Nigeria’s Cyber Threat Profile extends far beyond cybercrime, with other major cyber threats as classified under the National Cybersecurity Strategy.
“If we must survive as a nation, the current weak approach to enforcing national cybersecurity directives must be re-examined and prioritized among other considerations.
“The country must fund its cybersecurity and counter-terrorism programme not by foreign aid. Nigeria is facing multi-dimensional security challenges which pose existential threat and require extensive funding to resolve. The country must be committed to its ownership of national cybersecurity and counter-terrorism programmes for greater national stability.
“I commend both the Office of the National Security Adviser and the Central Bank of Nigeria for initiating the process for the operationalisation of the cybersecurity levy.
“On behalf of the Senate Committee on National Security and Intelligence, I humbly wish to seek for the support of all Nigerians on the policy as it has been made for the maximum benefit of the citizenry which will crystalize in the shortest possible time.”
However, its rejection by the House followed a motion of urgent public importance by Kingsley Chinda (PDP-Rivers).
The Minority Leader of the House said he was concerned that the CBN circular mandated all banks and other financial institutions and payments service providers to implement the Cybercrimes Act.
This, according to him, is by applying the levy at the point of electronic transfer origination as ‘cyber security levy’ and remitting the same.
Chinda said the wording of the CBN circular leaves the CBN directive to multiple interpretations, including that the levy be paid by bank customers, that is, Nigerians against the letters and spirit of Section 44(2)(a).
He said it was also against the Second Schedule to the Cybercrimes Act, which specified the businesses that should be levied accordingly.
The lawmaker said unless immediate steps were taken to halt the proposed action of the CBN, the cybercrime law would be implemented in error.
He said this is coming at a time when Nigerians were experiencing the aftermath of multiple removal of subsidies from petroleum, electricity and so on with the rising inflation.
Adopting the motion, the House directed the CBN to withdraw the ambiguous circular and issue an unequivocal circular in line with the letters and spirit of the law.
The House also directed the House Committees on Banking Regulations and other ancillary institutions to guide the CBN properly.
In separate interviews, the National Association of Small and Medium Enterprises (NASME) and other stakeholders have expressed divergent opinions.
In his own opinion, NASME Chairman in Oyo State, John Karunwi, the policy would further strain the economic recovery process.
While stating that the need for generating revenue could not be ignored, Karunwi, however, said the prevailing economic situation in the country had already had adverse effect on individuals, businesses, business owners and employees.
“Introducing 0.5 per cent cyber security levy on banking transactions now will further strain the economic recovery process, increase poverty, reduce business cash flow and liquidity.
“It will also increase business financial strain, leaving several nano, micro and small businesses to fold up due to poor cash flow to procure inputs, pay salaries and meet other running expenses,” he said.
According to him, this could also lead to laying-off of workers.
“Nursing mothers in paid jobs will undergo more stress in meeting up with work schedules in order to remain at work.”
Karunwi said the policy could have been delayed till when the economy must have fully recovered and businesses from the several devastating effects of the COVID 19 pandemic.
“Worst still, this policy is coming amidst previous ones, such as currency redesign, cashless policy, fuel subsidy removal, increase in electricity tariff and fuel scarcity,” Karunwi said.
To the first female African Professor of Computer Science, Adenike Osofisan, some of the policies being implemented by government were not well thought-out.
Osofisan underscored the need for government to think through ideas being suggested to it before implementing them.
“Many people give ideas for their own selfish reasons in Nigeria.
“Nigerians are already paying too much for certain things. The money National Information Technology Development Agency is making, can’t they take some of it for cyber security?, she queried, adding: “It is very unfortunate.”
However, a financial expert, Tunji Adepeju, said the cyber security levy was just like the education levy which government was collecting from the business sector.
According to him, the cyber security levy is for the agency fighting cyber crime, saying the banks will just be serving as collection centres, as they do not have anything to do with it.
“The cyber security levy is just implementing a law that had been enacted since 2016, but which was revised in 2024, just like the education trust levy whose implementation started many years ago.
“Just as people are complaining now, the business owners also complained about education levy because a certain percentage of their profits were paid to Federal Inland Revenue Service,” he said.
He, therefore, urged Nigerians to contribute to the cyber security levy, saying it would be specially managed through the appropriate authority.
“There is no better time to implement the levy than now, as it has been in the law.
“We must commend and praise the courage of the present administration in putting the nation on the right path,” the financial expert said.