On the social network X, the KuCoin team announced to Nigerian users that the tax applies only to the commission charged for the transaction, and not to the total amount of the transaction. For example, for the purchase of bitcoins in the amount of $ 1,000, the commission will cost $1 (0.1%), and the VAT on this commission will be $0.075. As a result, the net transaction amount will be $998,925, KuCoin explained.
The trading platform did not explain whether VAT applies exclusively to peer-to-peer transactions using the Nigerian naira or to all cryptocurrency transactions conducted on the platform.
From the President of the Coordination Committee of the Nigerian Blockchain Industry (BICCoN) Lucky Uwakwe has raised questions about KuCoin's ability to transfer VAT, given the restrictions of the Central Bank of Nigeria on the conversion of cryptocurrencies into the state currency. It is unknown whether banks will process cryptocurrency transactions, given the Central Bank's strict policy on cryptocurrencies. The regulator banned banks from servicing crypto companies a few years ago, although it refuted the ban on trading digital assets.
The president of BICCoN also wondered how the Nigerian government would check the number of users of the exchange and the accuracy of trade reports, as well as control the transfer of taxes collected. The lack of clear guidance may complicate compliance with regulatory requirements, Uvakwe fears.
Recall that in May, KuCoin announced its return to the Indian market, paying a fine of $41,000 and registering with the Financial Intelligence Department of India (FIU). However, in June, the Hong Kong regulator warned local traders against trading on KuCoin, saying that it had not issued a license to the exchange.