Mr. Muhammad Nami, Executive Chairman
Federal Inland Revenue Service
JUNE, 2020
His Excellency, the President of the Federal Republic of Nigeria, ably represented by the Secretary to the Government of the Federation
His Excellency, the President of the Senate
His Excellency, Speaker, House of Representatives
The Honourable Attorney General of the Federation & Minister of Justice
The Honourable Minister of Finance, Budget and National Planning
Members of the National Assembly
Board Members, Federal Inland Revenue Service
Distinguished Guests
Ladies and Gentlemen
Introduction
It is my honour and privilege to make this presentation at this auspicious occasion, which brings together important stakeholders in the public and private sectors to deliberate on the audit and recovery of stamp duties and launch of the Federal Inland Revenue Service (FIRS) adhesive stamps.
I sincerely thank all our stakeholders and partners for being a part of this epoch making event.
Background
The existence of Stamp Duty in Nigeria predates independence going by the 1st commencement date of 1st April 1939. (i.e. Ordinance 41 of 1939 and subsequent amendments).
Stamp Duties administration is governed by the Stamp Duties Act, CAP S8, LFN 2004 (as amended).
As the manner of business transactions continues to evolve and change pattern, so also the law on Stamp Duties. The Stamp Duties Act has therefore undergone several amendments over the years up to the Finance Act of 2019. The most recent amendment recognizes technology, economic realities, e-commerce and cross border transactions.
Stamp Duty is essentially a duty chargeable on both physical and electronic instruments. The Stamp Duties Act defines duty to mean âany stamp duty for the time being chargeable under any other Act and also includes any fee chargeable hereunder“.
The stamp is used to denote a dutiable instrument either electronically, use of an adhesive stamp or inked with a block die in acknowledgement for duty paid.Â
Section 2 of the Stamp Duties Act defined âstamp” as âan impressed pattern or mark by means of an engraved or inked block die as an adhesive stamp or an electronic stamp or an electronic acknowledgement for denoting any duty or fee“.
Furthermore, as the world becomes more global, COVID 19 has further limited physical interactions, electronic payments acknowledgement of duties at a time like this is a must.
2019 Amendments to the Stamp Duties Act
The Finance Act 2019 (Sections 52-56) amendment to the Stamp Duties Act has clearly defined responsibilities for the administration of Stamp duties in Nigeria and jurisdiction of participating taxing authorities. The FA 2019 Act has laid to rest;
The Schedule to the Stamp Duties Act contains a list of dutiable and exempted items. The dutiable items have been expanded under the FA 2019 to include electronic receipt or electronic transfer for money deposited in any bank; It further makes an upward review of duty from N4.00 to N50.00 on receipts or transfer between MDBs customers relating to N10,000 and above per transaction.
Chargeable Transactions
Fixed Duty Instruments: | Ad-Valorem Instruments: |
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Stamp duties is basically charged in two forms, either ad valorem; where duty payable is a percentage of the consideration on an instrument or a fixed sum irrespective of the consideration on dutiable instrument or document.
The Stamp Duty Commissioner is appointed by the relevant tax authority (either Federal or State) as prescribed by jurisdictional authority to administer the Act.
His/her functions are to administer the provision of the Act and to supervise the Stamp Duties office; adjudicating/assessment, stamping, imposition of penalties where necessary, ensuring the security of stamped instruments, and accounting for duties collected.
Relevant Taxing Authority
The Federal Inland Revenue Service, by section 4(1) of the Stamp Duties Act, is the only competent authority to impose, charge and collect Stamp Duties upon instruments specified in the Schedule of the Stamp duties Act where such duties relate to matters between a company and an individual, group or body of individuals.Â
The relevant tax authority in a State, by section 4(2) of the Stamp Duties Act, is empowered to collect Stamp duties on instruments executed by individuals at such rate as may be determined by the Act.
Previously, the FIRS collected Stamp duties on instruments executed by an individual resident in the Federal Capital Territory. However, this has ceased upon the creation of the FCT-Internal Revenue Service.
Review of Stamp Duties Collection Performance
 | N |
Stamp duties remitted by Money Deposit Banks (MDBs) | 20.00bn |
Stamp duties revenue from stamping of instruments | 7.90bn |
Stamp duties revenue from stamping of instruments | 39.00bn |
Total stamp duty remitted into Federation Account from January, 2020 â May, 2020 | 66.00bn |
On behalf of the Board, Management and staff of the FIRS, I register my sincere appreciation to the leadership of the National Assembly for their support and encouragement to the Service.
My special thanks goes to the Honourable Minister of Finance, Budget and National Planning for always being there for the Service.
The FIRS is open to engagement with all stakeholders for the purposes of repositioning the tax system for the benefit of our dear country.
We therefore invite all and sundry to come join hands with us in the task of building a virile tax system that will be a pride of all.
Conclusion
Let me leave with us, the words of a former American President, Benjamin Franklin who said, and I quote âIn this world nothing can be said to be certain except death and taxes”
Always remember that âit pays to pay your tax”.â
THANK YOU.â