In a shady and illegal manner, to boost government’s revenue, the central bank of Nigeria has instructed commercial banks across the country to extend the deduction of N50 stamp duty to savings account transactions.
The apex bank had previously exempted savings accounts through a circular issued on January 15, 2016. “For the avoidance of doubt, the following receipts are, however, exempted from the imposition of stamp duties: payment deposits or transfers by self to self, whether inter or intra bank; and any form of withdrawals/transfers from savings accounts.”
While it was not clear when the stamp duty collection was extended to savings accounts, some bankers said the only exemption now was deposits made by the owners of savings accounts.”
This means every third party deposit into a savings account with a value of at least N1,000, will be automatically charged N50 stamp duty fee, which the bank has a responsibility to transfer to the NIPOST Stamp Duty Account domiciled with CBN.
The circular reads “With immediate effect, all DMBs and other financial institutions shall commence the charging of N50 per eligible transaction in accordance with the provisions of the Stamp Duties Act and the Federal Government’s Financial Regulations 2009; that is, all receipts given by any bank or other financial institution in acknowledgement of services rendered in respect of electronic transfers and teller deposits from N1,000 and above.”
Meanwhile, the Lagos division of the Appeal had ruled that imposing a stamp duty on any electronic transaction was illegal.
The ruling on an appeal filed by Standard Chartered Bank against Kasmal International Services Limited and 22 others, Justice Ibrahim Saulawa and four other justices of the Court of Appeal, Lagos Judicial Division, held that the Stamp Duties Act, 2004 did not impose a duty on the DMBs to deduct N50 on bank deposits.
Meanwhile, the Lagos division of the Appeal had ruled that imposing a stamp duty on any electronic transaction was illegal.
The ruling on an appeal filed by Standard Chartered Bank against Kasmal International Services Limited and 22 others, Justice Ibrahim Saulawa and four other justices of the Court of Appeal, Lagos Judicial Division, held that the Stamp Duties Act, 2004 did not impose a duty on the DMBs to deduct N50 on bank deposits.