Amended Finance Act Okays Adhesive Stamps To Denote Transactions

The Finance Act’s enactment in January 2020 was heralded as a milestone event due to the far-reaching amendments it made to several tax statutes.

Stamp duty is a government (Federal or State) levy on written or electronic transaction documents, as prescribed by the Stamp Duties Act (SDA) and now under the Amended Finance Act. It is charged at a flat rate or a percentage of the transaction/instrument value (taking into cognizance the nature of the instrument).

Despite its huge potential, it remains an “untapped” revenue source, only wielded during incorporation of companies, dealings on the stock exchange, tendering evidence in court and perfection of title to property.

The Stamp Duty Act was barely enforced under the misconception that stamp duty was only required for admissibility of instruments in court.

With the Amended Finance Act, Adhesive stamps produced by Nigerian Postal Service (NIPOST) is now sole instrument of denoting any duty or fee, documents, receipts according to Section 2 of the Stamp Duties in the Finance Act 2019 Section 46 of Finance Acts 2021 as Amended.

This is interpreted to be that any transaction that is above N10,000 will be receipted, an adhesive stamp produced by NIPOST will be affixed on the receipt.

You will recall that at the onset of present administration led by the Postmaster General of the Federation/CEO, NIPOST, Dr. Ismail Adebayo Adewusi and under the leadership of the Chairman, NIPOST Governing Board, Barr. Maimuna Yahaya Abubakar took up the gauntlet and pursued vigorously the actualisation of the Stamp Duties Act in 2020.

The persistency of the Minister of Communications & Digital Economy, Dr. Isa Pantami who relentlessly has advocated the place of NIPOST in the Stamp Duties debacle.

It will be recalled that NIPOST reinstated that under the extant laws of Nigeria to wit NIPOST Act 2004 provides and vests solely in NIPOST the power to print adhesive postage stamps, which is the instrument for denoting documents and other transaction instruments in compliance with the provisions of the Stamp Duties Act.

Historically, the Post in Nigeria, just like in the comity of nations, has at different times produced adhesive postage stamps and revenue stamps for the Federal Government. It is to this end that NIPOST seeks the proper implementation of the Finance Act.

In addition, on 30 June 2020 the federal government inaugurated an Inter-Ministerial Committee on Recovery and Audit of Stamp Duty and announced its intention to position stamp duty as the next major revenue source for Nigeria as oil and gas revenues continue to dwindle due to a global fall in demand and price.

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