Altcoins Talks - Cryptocurrency Forum
Learning & News => News related to Crypto => Topic started by: ABCbits on July 04, 2024, 12:34:30 PM
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KuCoin to start collecting 7.5% tax on crypto transactions in Nigeria from next week
One of the popular crypto exchanges in Nigeria, KuCoin has announced that it will begin to collect a 7.5% Value-Added Tax (VAT) on transaction fees from its users in Nigeria.
According to an email sent to its users on Wednesday, the new tax regime will be effected starting next week on Monday (July 8). The 7.5% VAT will be deducted from the transaction fees of crypto transactions of users whose KYC information is registered in Nigeria... Read more here (https://technext24.com/2024/07/04/kucoin-tax-crypto-transactions-nigeria/).
Based on example calculation, the tax isn't as big as it sounds. I expect only people who trade daily in big amount who would notice impact of the fee. Your opinion is greatly appreciated.
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Based on example calculation, the tax isn't as big as it sounds. I expect only people who trade daily in big amount who would notice impact of the fee. Your opinion is greatly appreciated.
I am not really using Kucoin which makes me not to check their trading fee often and I do not know the percentage it is now. If the fee did not increase for Nigerians, that means it is the tax that Kucoin suppose to be paying before but which they are not paying because they are not registered in Nigeria. If the fee is not altered, it will not affect the traders.
Was the fee on Kucoin altered for Nigerians? Let me see what Nigerian active posters will post on this thread about this.
Edit:
The tax would be deducted from Nigerians and not kucoin directly. I got it from the calculation from the email sent by Kucoin.
Example Calculation:
Transaction: Buy 1,000 USDT worth of BTC
Fee: 1 USDT (0.1% fee rate)
Tax: 0.075 USDT (7.5% of the fee)
Net Amount for Transaction: 998.925 USDT
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Based on example calculation, the tax isn't as big as it sounds.
That's because it's a tax on some very low fees, it's like they have hiked their trading fees by 7.5%. Since those are usually below the one percent mark a simple market swing would cost traders more than this task.
It would have been worse if they had applied it to withdrawal fees also.
But I do find it interesting they are willing to comply with the laws.
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Isn't the value added tax supposed to be when withdrawal or exchange to the local currency? A tax of 7.5% per transaction is very expensive.
The exchange stressed that the VAT will be applied to the transaction fees in each trade, not the transaction amount, and covers all transaction types on the KuCoin platform…
This will result in fewer transactions and avoid using KYC exchange.
The price of Bitcoin will increase more than the global average price.
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That sounds like crypto transactions is treated as a regular purchase of goods and services in the country. If you're actively using crypto, you cannot feel the 7.5% VAT on a per transaction basis but that will probably hurt if you look at it on a yearly basis.
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KuCoin to start collecting 7.5% tax on crypto transactions in Nigeria from next week
Based on example calculation, the tax isn't as big as it sounds. I expect only people who trade daily in big amount who would notice impact of the fee. Your opinion is greatly appreciated.
The Nigerian government is a fraud and a scumbag. I don't know why would anyone want to ban crypto and then all of a sudden want to start receiving tax from people, that's hypocrite and shameful thing to do, they want tax but don't want to create a safe trade zone for their citizens, that's stealing and reaping where they didn't sow.
It's obvious Kucoin as an exchange is afraid to be labeled bad because of what has happened to Binance exchange with the Nigerian government and since the fees will coming from the exchange fees and not the traders and investors, that's their businesses. They can do all they want but if after this then tomorrow announced that Crypto is a scam, they should be ready for what comes later, scum government.
That is still better than what we are paying in India which is a 30% tax on cryptocurrency plus 1% TDS (Tax Deduction at Source) for every trade that is made on an exchange. In 2018 the government put a blanket bank on crypto trade by asking the Reserve Bank of India to stop all crypto to fiat and vice versa transactions. And in 2022 after the government had to remove the ban due to the interference of the Indian Supreme Court they came up with the tax policy. Every government mostly those in third world countries is always looking for ways to generate income through tax in everything that they can. Thankfully the air that we breath is not taxable for now but who knows what will happen in the future.
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--snip--
But I do find it interesting they are willing to comply with the laws.
I would speculate Nigeria government action against cryptocurrency industry (e.g. arresting Binance executives and old plan to ban P2P) are part of reason they decide to comply.
Isn't the value added tax supposed to be when withdrawal or exchange to the local currency? A tax of 7.5% per transaction is very expensive.
The exchange stressed that the VAT will be applied to the transaction fees in each trade, not the transaction amount, and covers all transaction types on the KuCoin platform…
This will result in fewer transactions and avoid using KYC exchange.
The price of Bitcoin will increase more than the global average price.
But have you seen example calculation stated on the news and by member @Charles-Tim? I think it's not big enough to discourage average trader, especially those who already submit their identity to such exchange,
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I'm still on the fence here, sure if you do one big transaction then maybe you can save some money. But it says that it is per transaction, and I doubt that every Nigerian can trade with worth of $1000 USDT as their example.
So for me it's big and it might affected those small traders from Nigeria. But I guess Kucoin is just complying with the law and so they don't have a choice but to put this is effect immediately.
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7.5% is indeed too much that its going to be subtracted EVERY transaction this is the worse agreement between their government and the exchange. Is the transaction they mean here a withdrawal transaction?
Because if its every transaction like even buying and selling, thats nit good.
Kucoin for now and they are in negotiation with other exchange, it must be an option if Binance can take less than 7.5%.
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The Nigerian government wanted to prosecute the cryptocurrency industry and the people within and supporting it but at the same time make some money too. Of course, this is hypocrisy to the highest level...an immoral act only a hollow administration can do. Maybe they now realized that their assumption that cryptocurrency has been a tool to destroy the country's economy is really false...and so why not imposed tax so they can make more revenues coming from the industry they despise too much. I am sad for the many Nigerians who are now realizing that there is something in cryptocurrency that is giving them the hope they deserve and an opportunity to create the bright future they are looking for especially for their children into the future. Kucoin has really no choice but to follow this order otherwise it would have to stop doing business in Nigeria.
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KuCoin to start collecting 7.5% tax on crypto transactions in Nigeria from next week
Will Binance not make a case for this, the government should let Binance and other exchanges back if it is tax they want, because Binance will be more willing to pay than loose the Nigerian market.
The government also needs to apologise for imprisoning binance official.
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And to whom is this tax paid to? The Nigerian authorities as a bribe or something? Or are they just pocketing it? Because if it's the latter, then it's not going to go down well with the community. "Tax" in the sense of collecting more money is why most of the platforms ran away from the US, and I can't imagine them bending over for some other country.
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If the tax is 7.5% on transaction fees only, it is not really a big deal, because the fees are usually 0.1% of the transaction value, so deducting 7.5% from this fee will not be a big problem.
This tax will be automatically calculated by KuCoin and therefore all Nigerians who have completed KYC will not be able to evade the tax. This makes crypto trading legal since the government collects the tax. Therefore, I believe that paying some fees is better than having the government ban Crypto as it did in the past.
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KuCoin to start collecting 7.5% tax on crypto transactions in Nigeria from next week
Will Binance not make a case for this, the government should let Binance and other exchanges back if it is tax they want, because Binance will be more willing to pay than loose the Nigerian market.
The government also needs to apologise for imprisoning binance official.
I also wonder about that. Other news media write news about Nigeria introduce 7.5% tax, but only mention KuCoin as exchange which do that. And i don't think they'll apologize, especially when the case itself is still on-going[1].
[1] https://www.coindesk.com/policy/2024/06/14/nigeria-drops-tax-charges-against-binance-executives-family-spokesperson/ (https://www.coindesk.com/policy/2024/06/14/nigeria-drops-tax-charges-against-binance-executives-family-spokesperson/)
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The sad part that title says "kucoin" but the reality is that its the government that asks for it and thats teh important difference. Kucoin is not doing anything, its not their doing, they are just following the law and they have nothing else to do about this situation. I think its quite normal that we are going to end up with some sort of different situation for a while and we could probably see a lot of people who will blame kucoin for this like they did it. If you have any anger towards this situation, which I can't because I am not from there but if you are Nigerian living in Nigeria and have any anger towards this situation, redirect your anger towards your government and not Kucoin because they did nothing about this at all, they are not the responsible one about this situation.
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The sad part that title says "kucoin" but the reality is that its the government that asks for it and thats teh important difference. Kucoin is not doing anything, its not their doing, they are just following the law and they have nothing else to do about this situation. I think its quite normal that we are going to end up with some sort of different situation for a while and we could probably see a lot of people who will blame kucoin for this like they did it. If you have any anger towards this situation, which I can't because I am not from there but if you are Nigerian living in Nigeria and have any anger towards this situation, redirect your anger towards your government and not Kucoin because they did nothing about this at all, they are not the responsible one about this situation.
I think because Kucoin will also protect the Nigerian government from what the people will think of them. But its always understood they are regulated by the government where they operate. Obviously they are forced to collect tax.
This makes them the partner of the Nigerian government, it will not be surprising to see other exchanges has this kind of contract to exchanges. Or not because they could be collecting more tax fees if it were Binance.
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I'm still on the fence here, sure if you do one big transaction then maybe you can save some money. But it says that it is per transaction, and I doubt that every Nigerian can trade with worth of $1000 USDT as their example.
So for me it's big and it might affected those small traders from Nigeria. But I guess Kucoin is just complying with the law and so they don't have a choice but to put this is effect immediately.
If you trade $100 the trade fee is still 0.1%, that's 10 cents. The 7.5% tax will be 0.75 cents so not even a full cent.
Are you telling me you can't afford that while trading?
7.5% is indeed too much that its going to be subtracted EVERY transaction this is the worse agreement between their government and the exchange. Is the transaction they mean here a withdrawal transaction?
7.5% of 0.1% is 0.0075%!
Every time the market moves in the opposite way 1% you lose 140 times more than this tax!
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The sad part that title says "kucoin" but the reality is that its the government that asks for it and thats teh important difference. Kucoin is not doing anything, its not their doing, they are just following the law and they have nothing else to do about this situation.
Just in case, the title written by the news author and i simply copied it without any modification.
I'm still on the fence here, sure if you do one big transaction then maybe you can save some money. But it says that it is per transaction, and I doubt that every Nigerian can trade with worth of $1000 USDT as their example.
So for me it's big and it might affected those small traders from Nigeria. But I guess Kucoin is just complying with the law and so they don't have a choice but to put this is effect immediately.
If you trade $100 the trade fee is still 0.1%, that's 10 cents. The 7.5% tax will be 0.75 cents so not even a full cent.
Are you telling me you can't afford that while trading?
I think it means they didn't read the complete news and @Charles-Tim reply.