‘It’s Illegal,’ FG Asks Nigerians To Report Merchants Demanding N50 POS Charge
The Federal Government has declared that the imposed N50 stamp duty on Point of Sales transactions by merchants is illegal and Nigerians should report violations with evidence when they occur.
The Central Bank of Nigeria (CBN) on Monday, clarified issues of the extra charges on customers by merchants, insisting that N50 stamp duty is a fee regulated by an act that directs merchants to pay all necessary taxes as regulated by government agencies.
This position was reiterated by the Federal Competition and Consumer Protection Commission (FCCPC) in a statement by its Chief Executive Officer, Babatunde Irukera, who insisted that in collaboration with the Central Bank of Nigeria (CBN), other relevant regulators and law enforcement authorities, the law will be enforced to its fullest extent.
“The Commission hereby provides this guidance pursuant to S. 18 (2) FCCPA and prohibits any such assessments pursuant to S. 18 (a), (e), (f) and (h).
“In addition to the provisions above, such assessments may be in violation of other extant provisions and law, including S. 129 (1) (a) and (2). The Commission, in collaboration with CBN, other relevant regulators and law enforcement authorities, intends to enforce the law to its fullest extent and invites consumers to report violations (when they occur) with evidence of such violations.”
It explained that the agency had engaged with the CBN and held that an assessment imposed on merchants necessarily is a component of their cost of doing business, and may only be directly passed on to consumer in limited circumstances.
“The FCCPC’s strongly held position was that an assessment imposed on merchants necessarily is a component of their cost of doing business, and may only be directly passed on to the consumer in limited circumstances.
“For many reasons, including and particularly the CBN’s effort to promote a cashless economy, the merchants’ response of imposing this assessment on consumers were not only inconsistent with the underlying policy, but also counterproductive and burdensome on consumers.
“Effectively, and in furtherance of this clarification, merchants are now prohibited from penalising or otherwise assessing any duty, costs or assessment characterised as “stamp duty” on consumers who select the point of sale options to conclude their purchases or transactions.”
Stating further, the agency maintained that businesses, by their very nature, already capture the operating cost price of their goods and services. “To impose an additional fee on consumers that is exclusive of price and discriminates based on the selected mode of payment essentially amounts to a penalty for the adopted mode of payment.”
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