Electronic Funds Transfers And Teller Deposits Are Not Receipts On Which Stamp Duty Should Be Charged, Court Of Appeal Holds

The Court of Appeal has resolved the dispute on imposition and
collection of stamp duties on bank deposits and electronic
transfers, which means that banks are no longer required to impose
stamp duties on such transactions.

The Pen-Ultimate Court held this whilst reversing the decision
of the Federal High Court which is to the effect that the sum of
N50 be charged as stamp duty on all receipts including electronic
bank transfers and teller deposits of N1, 000 or more.

TheNigerialawyer (TNL) recalls that in 2013,
the Nigerian Postal Agency (NIPOST) entered into an agreement with
an agent to collect from banks, the said sum on all receipts
including electronic bank transfers and teller deposits of N1, 000
or more.

The parties had agreed the new rate on the ground that the Stamp
Duties Act (which imposes N1.50k for receipts with a value of not
less than N40) had been amended by a ‘Federal Government Financial
Regulations 2009’ [Regulations]. Many of the banks refused the
charges and remitting same, arguing that the amendment was not in
line with the law. This led to the agent suing all 22 banks. The
agent also sued the Central Bank of Nigeria in another suit, asking
the Court to compel same to comply. The CBN in response issued a
circular to banks asking them to comply.

Reversing the decision of the Trial Court, the Court of Appeal
held, amongst other things, that: receipts given for monies
deposited in the bank were exempt from stamp duties by virtue of
Schedule 4 to the Stamp Duties Act; electronic funds transfers and
teller deposits were not receipts on which stamp duty should be
charged; and that there was no amendment to the Act, therefore, the
agent had no legal right to sue.