Business
Stamp duty crisis widens
...banks keep mum over unremitted billions
By YUSUF MOHAMMED
The controversy surrounding the alleged non-remittance of stamp duties collected on behalf of government by banks to the Federation Account is not abating, Business Hallmark checks have revealed.
The Stamp duties, which come to a statutory N50 on every current account receipt of N1, 000 and above are usually deducted by the banks on behalf of the Nigerian Postal Service and the Federal Inland Revenue Service and then remitted to government through the Central Bank of Nigeria.
With pressure being mounted on government to get more and more resources with which to deliver critical and much needed development to the people, it is clear that this source of revenue that has recently begun to gain relative traction in the country as an assured source of finance for the nation would not easily go under the radar.
It will be recalled that the saga of the unremitted Stamp duties had recently returned to the front burner of public discourse in the country following a motion on the floor of the House of Representatives demanding an inquiry into an estimated N20million in unremitted stamp duties.
Before then, the Revenue Mobilisation and Fiscal Commission had also taken exception to what has been described as the paltry 33billion that had been remitted under the scheme, with the commission promising to launch an investigation.
According to the commission, the actual sum should not be anything less than N100billion and with some more tinkering, revenue from the scheme could come to as much as N500billion.
While Nigeria has over a hundred million bank accounts at the moment, as at April, 2018, only about 31m Nigerians had been enrolled in the Central Bank of Nigeria’s Bank Verification Project. By February 2019, the number had risen to 36.8m.
And of this total number of verified account users, the ratio of current to savings accounts comes to about 1:5. This would then mean that there are about 7.4million current account holders in the country.
Should half of that number receive deposits of N1, 000 and above in every month, the estimated stamp duties collection for the year would come to about N44trillion. To arrive at the figure of N200trillion that is the benchmark being used by the House of Representatives therefore would mean that Nigerian current account holders receive as much as 4 or more alerts of N1, 000.00 and above within a given month.
But the banks are not talking
Repeated efforts to get banks to speak on the subject have met with very little cooperation.
Funmilayo Falola, Head of Brand and Marketing Wema Bank in responding to our enquiries sent a terse reaction:
“We have zero unremitted. We have attended the house of rep meetings and they cleared us fully. The CBN also sent auditors and they gave us clean bill of health.”
On his part, Idoko Negedu of GTBank simply responded: ‘I can’t comment at the moment.’
Similar reactions also came from spokespersons for UBA when Business Hallmark made contact.
On his part, Rasheed Bolarinwa, Head Corporate Communications, Polaris Bank failed to answer questions put across to him on the phone. He opted to answer via email but also failed to reply when the queries were communicated to him by mail.
Louis Ibe, Head Corporate affairs and media management, FCMB did not respond to several calls to his telephone line.
But even as the question of how much exactly the Stamp Duties scheme should gross for government is being determined, there are also battles being fought on the legal turf to determine the legality and reach of the scheme.
After an agent of the government had secured initial victory at the Federal High Court, the Court of Appeal had gone on to rule that ‘receipts given for monies deposited in the bank were exempt from stamp duties by virtue of Schedule 4 to the Stamp Duties Act; electronic funds transfers and teller deposits were not receipts on which stamp duty should be charged; and that there was no amendment to the Act therefore the agent had no legal right to sue.’
Despite this ruling however, the Federal Inland Revenue Service is still coordinating continued deductions even for some of these categories, while the verdict of the Supreme Court of Nigeria on the matter is being awaited.
Efforts to get a response from the Federal Inland Revenue Service, FIRS, in this regard were not equally successful as at press-time with its spokesman asking for a written query to be sent to him. He had not responded as at the time of filing this report.
