Connect with us

Business

Banks jittery over probe of N20 trillion ‘non-remitted’ stamp duty

Published

on

  • Banks blame CBN for the problem

By ADEBAYO OBAJEMU

Nigeria’s commercial banks are reportedly in panic over last week’s move by the House of Representatives to dig into the non- remittance of stamp duty revenue.

The resolution to probe the non-remittance was consequent upon  the adoption by the House  of   a motion of urgent national importance brought before it by Goni Lawal (APC, Yobe).

The lawmaker representing Bursari/Gaidam/Yunusari Federal Constituency had raised various issues against the collection and remittance of the tariff. His motion was unanimously adopted. The House agreed unanimously  to set up an ad hoc committee to urgently investigate the non-remittance of trillions of naira into the Federal Government’s Treasury Single Account, TSA and report back to the House within four weeks.

But the Corporate Affairs Manager of Zenith Bank, MR. Marcel Iguabor told BusinessHallmark that “There is no iota of truth in any report that Zenith has not been remitting the money. It is not true. Zenith has no money to remit, it is fake news. Fake news! The money is direct debit from CBN.”

Text messages sent to Head Corporate Affairs, CBN were neither acknowledged nor replied; neither was our call answered to get the apex bank’s side of the story.

Yemisi Owonubi, External Relations Specialist, Corporate Communication & Marketing of  Union Bank , said she would respond to BusinessHallmark’s inquiry on the bank’s position in writing, but failed to do so as at the time of going to the press.

Lawal recalled that few years ago, banks were mandated to collect five percent stamp duties from account holders on every cheque exchange. He said while the “deductible amount per bank account seems small, it cumulatively adds up to money in billions and trillions of naira and must be subjected to the full condition of disclosure and transparency.”

The duty in question is the tax levelled on legal documents, normally, in the transfer of assets or property.

The House resolution is sequel to  an FOI request sent in last July on behalf of LeaksNG to the Central Bank of Nigeria (CBN), Office of the Secretary to the Government of the Federation (OSGF), Nigerian Postal Service (NIPOST), and the Nigeria Inter-Bank Settlement System (NIBSS) PLC.

Advertisement

The information  on request were a report on stamp duty remittances by Deposit Money Banks and other financial institutions, the current status of the stamp duty central account domiciled in the CBN, stamp duty revenue remitted to the CBN by NIBSS between 2016 and 2017 and amount of revenue collected by NIPOST between 2016 and 2018.

The lawmakers pointed a finger at the banks and other federal agencies involved in the collection of the fund for “shortchanging the nation”.

Recall that in February, the  Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), had hinted of its resolve to  commence  similar probe of banks over the same  stamp duties collection as it said it would  recover more than N120 billion from the probe. The Commission on its own did not say when the probe would begin.

The Commission said the probe would involve a forensic investigation of the funds that had so far been collected as stamp duty by 22 Deposit Money Banks (DMB) from 2016 to 2018. RMAFC in a release said it is the only constitutional body vested with the powers to monitor all revenue accrual into the Federation Account.

“To this end, the commercial banks had been deducting the sum of N50 on every deposit with a value of N1,000 and above since January 2000.

“At the moment, the total sum of N33 billion had been realised through the collection of stamp duties which falls far below the expectation of stakeholders. It is expected that at the end of the exercise, over N100 billion would be recovered,” it said.

Ibrahim Mohammed, the Commission’s spokesperson in a  press release said that the commission had concluded arrangements to engage the services of reputable forensic audit firms to carry out the probe.

He  stated that the need to reposition NIPOST was important, adding that  if the Nigerian Postal Service (NIPOST), was properly repositioned through appropriate legal and regulatory framework, and the introduction of appropriate technology, the agency could generate over N500 billion.

It was learnt that two months after the requests were put forward, on September 26, letters of reminder were sent to the various offices but none of the institutions had managed to fulfill its legal obligations by providing the information as of the time this report was filed.

Advertisement

It was learnt that NIPOST and NIBSS have not bothered to respond at all, others, however, gave excuses for their inability to oblige.

Of the five agencies that received inquiries requesting information, only three responded, but papered over the responsibility to disclose information. The OSGF, in its reply dated August 9, 2018, said it had referred the FOI application to the Federal Inland Revenue Service (FIRS), which according to it is better positioned to provide answers.

“After a careful review of the application,” wrote J.O. Obule, acting legal adviser to the secretary, “the Office is of the view that the Federal Inland Revenue Service (FIRS) has a greater interest and is the custodian of the information sought and therefore would be in a better position to provide same.”

However,  lawmakers  pointed fingers at the  banks and other federal agencies involved in the collection of the fund of “shortchanging the nation”.

“To this end, the commercial banks had been deducting the sum of N50 on every deposit with a value of N1,000 and above since January 2000.

NIPOST is said to have entered into an agreement in 2014 with an agency to collect stamp duties and armed with the masters service agreement with NIPOST, the School Banking Honours approached the Central Bank of Nigeria for authorisation to engage deposit money banks and other qualified stamp duties collection agents, and the CBN gave the required approval. But it has been excluded from performing the role.

 

Tags

Facebook

Advertisement

Advertisement