Starting July 8, 2024, users of KuCoin in Africa’s most populous country, Nigeria, will see an increase in trading fees due to the introduction of a 7.5% Value-Added Tax (VAT). As KuCoin Africa announced this update to its community, it noted the new tax’s implications for users in Nigeria.
Key Points of the KuCoin Update
In the announcement shared, KuCoin stated, “We are writing to inform you of an important regulatory update that impacts our users from Nigeria. Starting from July 8th, 2024, we will begin collecting a Value-Added Tax (‘VAT’) at a rate of 7.5% on transaction fees in each trade for users whose KYC information is registered in Nigeria.”
Notably, the 7.5% VAT will be applied only to the transaction fees, not the total transaction amount. For instance, if a user buys 1,000 USDT worth of BTC, with a fee of 1 USDT (0.1% fee rate), the VAT will be 0.075 USDT (7.5% of the fee), resulting in a net transaction amount of 998.925 USDT.
✅KuCoin introduces 7.5% VAT on trading fees for Nigeria Users
We are writing to inform you of an important regulatory update that impacts our users from Nigeria.
Starting from July 8th, 2024, we will begin collecting a Value-Added Tax (“VAT”) at a rate of 7.5% on… pic.twitter.com/Y6elL3RjFi
— KuCoin Africa (@KuCoinAfrica) July 3, 2024
This tax will be levied on all transaction types on the KuCoin platform, ensuring compliance with local regulations. Market experts say KuCoin likely introduced the VAT following the government’s directives.
KuCoin is a global cryptocurrency exchange, that provides Nigerians with a platform to buy, sell, and trade Bitcoin. However, the current Nigerian administration has raised concerns about the impact of cryptocurrency trading on the national fiat currency.
This has led to stricter regulations and crackdowns on exchanges, including Binance.
Impact on Nigerian Users
Although KuCoin’s announcement signals compliance with regulatory authority, users in the country perceive the move as unfavorable. A user Crypto_Boy (@Sagir7g7) wrote: “But crypto transaction in Nigeria is illegal…. Is Nigeria interested in collected (sic) illegal money?” A reference to the earlier crackdown on crypto and P2P platforms.
Other comments seen by Crypto-Vanguard on different social media channels including Telegram show displeasure with some threatening to withdraw their funds before the set date and delete the app.
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