Stamp Duty: Matters Arising

The Federal Government through the Central Bank directed that all the commercial banks in the country collect a Stamp duty of N50 for any transaction in excess of one thousand Naira (N1000). You can download the circular here. A lot of reactions have trailed this development. The most popular reaction being that the government wants to shore up its depleted purse by extorting the common man on the street.

Let us examine the legality of this directive from the Central Bank of Nigeria. It appears that the Federal government is only trying to implement a law that was enacted as far back as 2004 - "The Stamp Duties Act". You can download the Act here. So, basically the Stamp duty act is a bill passed into law by the Nigeria national Assembly which makes it compulsory that a stamp must accompany some transaction carried out in the federal republic of Nigeria. The Federal Government generates revenue sale of stamp which is the responsibility of the Nigerian Postal Service (NIPOST).

The Implementation of this law was not effectively implemented. Though the Judiciary and many government parastatals did implement it to varying degrees. But the Banking Sector never really implemented the Stamp Duty Act. The Central Bank of Nigeria tried to get the Commercial banks to start implementing the law in 2009 but nothing came out of it. You can download the 2009 circular here.

This present economic situation in the country has obviously prompted the government to put on their thinking cap in their quest to increase government revenue. Despite how difficult this might seem to the citizenry, I think everyone should accept this development in good faith and hope the government will utilize this our N50 judiciously in building a better country for all of us.

The sad truth is that we want a better country but we are always reluctant to make the necessary sacrifices. N50 per transaction greater than one thousand naira (N1000) is not such a big sacrificeto make for a better country