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Tax Evasion: Nigerian Court Drops FIRS Charges Against Binance Executives

Tax Evasion: Nigerian Court Drops FIRS Charges Against Binance Executives

Federal High Court in Nigeria has dropped tax evasion charges by Nigeria’s Federal Inland Revenue Service (FIRS), against Binance Executives, Nadeem Anjarwalla and Tigran Gambaryan.

The court struck out the charges after Binance and the FIRS confirmed the appointment of Ayodele Omotilewa as the company’s representative, with the FIRS filing a fresh charge listing Binance as the sole defendant. 

The drop in charges is coming after both executives were charged with tax evasion on March 25, 2024, after the FIRS alleged that they failed to pay taxes on cryptocurrency transactions worth billions of Naira.

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Fast forward to May 2024, the FIRS  amended its lawsuit, alleging that Binance failed to collect and remit various categories of taxes to the federation, particularly the Value Added Tax (VAT) and  Company Income tax (CIT), as stipulated by Section 40 of the FIRS Establishment Act 2007 as amended

It also disclosed that the crypto exchange failed to register with the FIRS, for tax purposes, an offense punishable under section 8 of the Value Added Tax Act of 1993. Binance was also accused of aiding customers to evade taxes through its platform.

In the FIRS fresh charge as seen by Tekedia, Binance is now listed as the sole defendant implying Gambaryan and Nadeem are no longer associated with its case. 

In the charge, the crypto exchange platform was accused of offering services, which involved the buying and selling of cryptocurrencies and the remittance and transfer of those assets to Nigerians while failing to deduct the necessary Value Added Taxes(VAT), arising from its operations. 

Part of the charges read,

“That you BINANCE HOLDINGS LTD on or about the 1st February 2024, in Abuja, FCT within the Jurisdiction of this Honourable Court, whilst involved in the offering of services to subscribers on your trading platform, known as Binance did aid and abet those subscribers on your trading platform to unlawfully refuse to pay taxes, or neglect to pay those taxes and in so doing committed an offense contrary to and punishable under the provisions of S.94 of the Companies Income Tax Act (as amended),” Count 4 of the four-count charge reads.

Speaking on the drop of tax charges against Binance Executives, a Spokesperson at the company Ivy Shirinda said,

We are relieved that the Federal Inland Revenue Service (FIRS) has served and filed amended charges today, resulting in tax charges against Tigran Gambaryan being dropped, further illustrating that Tigran is not a decision-maker at Binance and does not need to be held in order for Binance to resolve issues with the Nigerian government”.

She added “we are deeply disappointed that Tigran Gambaryan, who has no decision-making power in the company, continues to be detained”.

It is however worth noting that last week, 16 U.S. members of Congress, including the chair of the Foreign Affairs Committee, Michael McCaul, wrote to U.S President Joe Biden, highlighting that Tigran is a “U.S. citizen wrongfully detained by a foreign government, urging him to do more to secure his release.

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