Thursday, May 6, 2021

N50 stamp duty on bank deposits and transfers illegal: Federal High Court

Nigerian banks have been charging N50 as stamp duties on transactions above N1,000 across the country for several years.

• December 11, 2020
Central Bank of Nigeria, CBN
Central Bank of Nigeria, CBN

The Asaba Division of the Federal High Court has declared as illegal all ongoing stamp duty deductions by Nigerian banks. 

Justice Nnamdi Dimgba said the Central Bank of Nigeria and all banks should immediately stop further collections of stamp duties from Nigerians because there was no provision for such taxes under the Stamp Duties Act.

The judgement came on December 9 in a case filed against the CBN, Zenith Bank and the attorney-general by Rupert Irikefe, a businessman.

Mr. Irikefe was also awarded N500,000 in damages for the inconveniences he suffered when deductions were imposed on his bank account starting in January 2016.

Nigerian banks have been charging N50 as stamp duties on transactions above N1,000 across the country, a controversial policy that has long been criticised by citizens who saw it as exploitative and one-sided. The banks were asked to impose the charges by the CBN.

Mr. Dimgba also said the banks should suffer additional damages because they failed to comply with a previous ruling on the matter by the Court of Appeal in 2014, continuing to charge stamp duties on transactions despite being aware of the appellate court position on the matter. 

Download full court judgement here.

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