Federal High Court Adjourns FIRS’ $79.5 Billion Tax Suit Against Binance to April 7

The Federal High Court in Abuja has adjourned the hearing of the tax evasion suit filed by the Federal Inland Revenue Service (FIRS) against Binance Holdings Ltd until April 7, 2025. The case, which seeks to recover a staggering $79.5 billion in alleged economic losses, was initially scheduled for hearing on Monday but could not proceed before Justice Inyang Ekwo. The adjournment came after the judge went on recess following the hearing of other cases.

FIRS, in its lawsuit marked FHC/ABJ/CS/1444/2024, has dragged Binance, along with its executives Tigran Gambaryan and Nadeem Anjarwalla, before the court. The agency is seeking several declarations and financial penalties against the cryptocurrency exchange for allegedly operating in Nigeria without proper registration, failing to pay corporate income tax, and engaging in financial activities without the necessary licenses.

FIRS’ Claims and Financial Demands

Filed on September 30, 2024, by Chief Kanu Agabi (SAN), the lawsuit argues that Binance had a significant economic presence in Nigeria from 2022 to 2023 and was therefore required to pay corporate income tax under Section 13(2) of the Companies Income Tax Act (CIT Act) and the Companies Income Tax (Significant Economic Presence) Order 2020.

FIRS has asked the court to declare that Binance and its representatives:

1. Are liable to pay corporate income tax for their business activities in Nigeria from 2022 to 2023.
2. Must file income tax returns for the relevant financial years.
3. Owe the Federal Government a cumulative sum of $2.001 billion in unpaid taxes for 2022 and 2023.
4. Should pay additional penalties, including:
   • A 10% surcharge per annum for non-payment.
   • A 26.75% interest rate, based on the prevailing Central Bank of Nigeria (CBN) lending rate, effective from January 1, 2023, and January 1, 2024, respectively, until the full amount is paid.

Government Investigation: Binance’s Alleged Infractions

According to an affidavit filed by Jimada Yusuf, a member of the Special Investigation Team from the Office of the National Security Adviser (ONSA), Binance had been operating in Nigeria for over six years without registration or regulatory approval.

The affidavit revealed that:

• Binance executives admitted in a 2024 meeting with the Securities and Exchange Commission (SEC) that the company had 386,256 active Nigerian users, generating a trading volume of $21.6 billion and net revenue of $35.4 million in 2023.
• The platform offered financial services without a license, failed to comply with Nigeria’s Money Laundering Act, and facilitated currency speculation without authorization.
• Binance engaged in Virtual Asset Service Provider (VASP) activities, offering trading and custodial services to Nigerian users without regulatory approval.

Ongoing Legal Battles

In addition to the FIRS lawsuit, Binance is also facing separate charges from the Economic and Financial Crimes Commission (EFCC) before Justice Emeka Nwite of the same court. These cases highlight the Nigerian government’s increasing crackdown on cryptocurrency exchanges that operate outside the country’s legal and financial framework.

With the next court hearing set for April 7, 2025, all eyes remain on how Binance will respond to the multi-billion-dollar tax evasion claims and the broader implications for cryptocurrency regulation in Nigeria.

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