- FG Defies Court as Banks Continue Stamp Duty Collection
The Federal Government and its agencies have continued to defy the ruling of the Court of Appeal that the deduction of stamp duty on bank deposits is illegal.
Investigation by our correspondent showed that the Technical Committee on Stamp Duty had advised the Central Bank of Nigeria to issue a circular to the banks to stop collecting stamp duty of N50 on deposits into current accounts with value of N1,000 and above.
Although the court ruling was given on April 21, investigation showed that the apex bank had yet to issue the circular. The duty is projected to yield N2.5tn to the Federal Government per annum.
Some bankers, who spoke to our correspondents on the condition of anonymity, said they had yet to get any circular from the CBN to stop the collection.
The spokesperson for the CBN, Mr. Isaac Okoroafor, told our correspondent on the telephone on Thursday that the apex bank had nothing to do with the stamp duty.
He asked our correspondent to refer every question on the subject to the Nigerian Postal Service.
The spokesperson for NIPOST, Hajiya Simbiat Lawal, was indisposed when our correspondent called her on Thursday, but she had earlier said if there was a court ruling, the organisation, as a law abiding entity, would abide by the decision of the court.
The CBN had in a January circular issued to the Deposit Money Banks in the country directed them to deduct N50 for stamp duty on every deposit in a current account amounting to N1,000 and above beginning from January 1, 2016.
The circular, which has since been implemented by the banks, was in spite of the fact that there was a subsisting issue in court on the subject.
Ruling on an appeal filed by Standard Chartered Bank against Kasmal International Services Limited and 22 others, Justice Ibrahim Saulawa and four others justices of the Court of Appeal, Lagos Judicial Division, held that the Stamp Duty Act, 2004 did not impose a duty on the banks to deduct N50 on deposits.
Kasmal International Services Limited, which belongs to Senator Buruji Kashamu, had on February 17, 2014 obtained the judgement of a Lagos High Court against the banks to the effect that that they should remit more than N6bn they were supposed to have collected on deposits since the Stamp Duty became an Act of Parliament in 2004 through it to NIPOST.
According to Kasmal, NIPOST had appointed it as an agent to collect the stamp duty on its behalf from banks and, therefore, the banks should remit the money accruing as stamp duty through it to the postal organisation.
However, in a lead judgment, Justice Saulawa held that the Stamp Duty Act imposed no such duty on the banks. In concurring rulings delivered by a panel of the Appeal Court, Justices Ejembi Eko, Adamu Jauro, Moore Adumein and Nonyerem Okoronkwo agreed in totality with the ruling delivered by Saulawa.
The appeal court set aside the ruling of the lower court delivered by justice C. J. Aneke on five grounds.