The Digital Assets Coalition (DAC) has called on the Federal Government to restructure its approach to taxing virtual asset transactions, arguing that tax should apply only to realised profits rather than the gross value of money flowing through cryptocurrency platforms.
The coalition made its position known in Lagos on Thursday in response to the Nigeria Revenue Service's newly issued guidelines on virtual asset taxation.
DAC stated that while it fully supports the regulation and taxation of digital assets, it objects to the one per cent withholding tax levied on the entire value of certain transactions. The group warned that under the current framework, a taxpayer could incur a tax obligation even when a transaction results in a net loss.
The coalition highlighted several categories of individuals who could be unfairly affected by the existing approach. These include students receiving financial support from family members abroad, freelancers converting earnings on which income tax has already been paid, and traders who close positions at a loss but whose total transaction volume still attracts the withholding levy.
DAC urged the NRS to revisit the guidelines and recalibrate the tax to target actual gains from digital asset dealings. The group maintained that such a revision would safeguard Nigeria's expanding digital asset ecosystem while ensuring that the government collects its fair share of tax revenue from the sector.
