Nigerian banks on Thursday announced that they will kick-start the implementation of the stamp duty charge of 0.375 per cent on loans backed by legal mortgages, shares, debentures or bonds.
This is coming after the Federal Inland Revenue Service (FIRS) had directed banks to implement stamp duty on certain transactions that requires duty payments such as contracts and legal mortgages.
According to the FIRS, as the manner of business transactions continue to evolve and change pattern, the law on stamp duties will also change. It noted that the stamp duties has therefore undergone several amendments over the years up to the Finance Act 2019.
Stamp duty is essentially a duty chargeable on both physical and electronic instruments. The stamp duties Act defines duty to mean “any stamp duty for the time being chargeable under any act and also includes any fee chargeable hereunder”.
In several email notifications sent to its customers, banks revealed that they will start implementing the FIRS directive while adding that the charge will be applied to the value of the assets and remitted back to the revenue office.
Access Bank in an email notification titled to its customers, “Stamp Duty Automation Update”, said, “We will like to inform you that the Federal Inland Revenue Service (FIRS) has directed all Nigerian banks to implement stamp duty on certain transactions that require duty payments such as contracts and legal mortgages”.
The bank noted that in compliance to this directive, it have taken measures to streamline the process to make transactions more convenient for its customers.
“To this end, a stamp duty charge of 0.375 per cent will be applied to loans backed by legal mortgages, shares, debentures or bonds. The charge will be applied on the value of legal mortgages, shares, debentures or bonds and remitted to the FIRS”, the bank said.
Access Bank added that all previously approved loans will remain unchanged and should be repaid in full as per the agreed terms and conditions.
“We are committed to providing you with exceptional service”, it said.
It will be recalled that the Federal Government stated it is looking to expand net on transactions covered by the stamp duty charges from regular bank transfers.