CBN Stamp Duty Charges On Deposits – Can Something Be Built On Nothing?

INTRODUCTION

On 15th January 2016, the Central Bank of Nigeria (CBN) issued a circular, "Collection and Remittance of Statutory Charges on Receipts to Nigeria Postal Service under the Stamp Duties Act" (the Circular) to all Deposit Money Banks (DMBs) and other Financial Institutions (FIs) in Nigeria. This initiative was part of the Federal Government (FG)'s efforts to boost revenue collection in the non-oil sector following the oil price nosedive and reduction in related oil sector receipts.

All DMBs and FIs were instructed to charge Fifty Naira (N50) as stamp duty (SD) on all receipts issued in acknowledgment of services rendered in respect of electronic transfer and teller deposits from N1,000 in accordance with the provisions of the Stamp Duties Act, Cap S8, LFN 2004 (SDA) and the Federal Government Financial Regulations 2009 (FGFR). This rate, payable by the receiving accounts, exempts self - to - self deposits/ transfers, whether inter or intra bank; and