While the deposits hitting the current accounts of bank customers are being debited for stamp duty, the Revenue Mobilisation Allocation and Fiscal Commission has placed an embargo on the fund as a result of a court case, EVEREST AMAEFULE writes
For the three tiers of government looking for ways to shore their revenue base, the fund accruing from the recently reenergised stamp duty is still far from their reach.
This is because the Revenue Mobilisation Allocation and Fiscal Commission has placed an embargo on the fund lodged in a Single Treasury Account with the Central Bank of Nigeria known as the Stamp Duties Account.
Going by the projection of the Nigerian Postal Services and the CBN, the account may have attracted about N833bn in the first four months of the year.
The Federal Government had projected that the deduction of N50 on every banking deposit into a current account with a value of N1,000 and above would give the nation as much as N2.5tn per annum. This translates to N206.33bn a month and N833.33bn for the first four months of the year.
Although the implementation started in January through the issuance of a memo by the CBN, sources at the RMAFC said the revenue agency had placed an embargo on funds accruing from the duty.
This is because of a court case that was instituted against the CBN and 23 banks by one of the companies allegedly appointed by NIPOST to act as its agent for the collection of the stamp duty for transactions in the banks and other financial institutions.
The company, Kasmal International Services Limited, owned by Senator Buruji Kashamu, had gone to court to compel the banks to remit about N6tn to NIPOST for the stamp duties they are supposed to have collected between 2004 and 2013.
The banks had allegedly failed to deduct stamp duties on electronic transactions because the Stamp Duty Act of 2004 had not made any provision for the deduction of stamp duty on electronic transactions but on transactions where stamps are supposed to be affixed.
However, Kasmal International Services Limited contends that the banks are supposed to collect the duty on behalf of NIPOST. The company also claims that it is entitled to 20 per cent of the fund in accordance with the agency agreement it allegedly signed with the postal agency.
It is on the strength of the subsisting court case that the RMAFC has restricted access to the stamp duty account, which is supposed to be swept into the Federation Account for sharing among the three tiers of government.
This development, investigation showed, would not only affect the fortunes of the three tiers of government, which are currently starved of funds to carry on with basic functions of governance, but also the operations of NIPOST, which has been expecting relief with the implementation of the duty.
One of the things that may be affected at NIPOST is the new salary structure, which has since been submitted to the government. The government’s nod on this may have to linger. Several proposed renewal programmes of the postal system may also stay in the pipeline.
The Special Assistant to the Minister of Communications on Media, Mr. Victor Oluwadamilare, declined to comment on the development. Similarly, the Public Relations Manager of NIPOST, Mr. Taiye Olaniyi, declined to speak on the subject.
Attempts to speak with Acting Postmaster General of Federation, Mr. Richard Balami, on the restriction of access to the fund proved abortive. A text message sent to his mobile phone had yet to be replied as of press time.
It is not only access to the stamp duty account that has been stalled by the court case instituted by Kasmal. In April, the Senate called for a public hearing into the controversy surrounding the sour relationship between NIPOST and the firm. The upper legislative chamber found out that it could not do much because of the court case.
The work of the technical committee set up to clear the grey areas on the implementation of the stamp duty has also been stalled as a result of the court case. Part of the work of the committee is to determine what percentage of the duty should go to NIPOST as the cost of collection.
Membership of the committee chaired by RMAFC is drawn from the CBN, NIPOST and Office of the Accountant-General of the Federation.
The committee is also expected to examine some transactions that have been exempted from stamp duty in order to ensure that they don’t become an albatross to the implementation of the policy. It is also expected to monitor the accruals into the stamp duty account.
Since the CBN took the decision to coerce banks to start deducting stamp duty in January this year, the duty has been enmeshed in one controversy or the other. There was the resistance of bank customers who said it was unjust to coerce them to pay dated duty that they get no benefit whatsoever from.
There has also been controversy over the role of the different government agencies and agents in the collection of the stamp duty as well as what accrues to who. These issues have not been resolved.
The appointment of agents for the collection of the stamp duty has also not gone without its controversy. Apart from the ongoing dispute on the status of Kasmal International Services Limited in relations to the stamp duty, the appointment of agents for the collection of stamp duty in other sectors of the economy has also attracted negative publicity.
In March, the commencement of the process for the appointment of 20 new agents caused a spat between the Minister of Communications, Mr. Adebayo Shittu, and the former Acting Postmaster General of the Federation, Mr. Enoch Ogun.
While Shittu said the process for the appointment of the agents should be suspended until the issues surrounding Kasmal was sorted out, Ogun said he received no such directive and also claimed that the appointment of agents was a routine duty handled by a standing committee charged with the responsibility.
The controversy claimed the job of Ogun, who was shown the way out of the postal system even though he had been asked to head the organisation until a substantive PMG was appointed.
As the controversy surrounding the attempt by the government to shore up its revenue base through the interpretation of the Stamp Duty Act of 2004 deepens, one thing that has remained constant since January is the alert informing bank customers of the deduction of N50 on deposits from their accounts. What becomes of the monies will be determined in the days ahead.