Stamp Duty: There Is No Basis For Rent Increment, Says FIRS

 

The Federal Inland Revenue Service (FIRS) has asked landlords and agents not to increase rents in relation to the stamp duty payable on tenancy and lease agreement by tenants in the country.

In fact, tenants, not landlords, should pay the applicable stamp duty by themselves at any commercial bank of their choice, not to any landlord.

Executive Chairman, FIRS, Mr. Mohammad Mamman Nami, gave this clarification in Abuja on Tuesday as part of his ongoing national public enlightenment campaign on the Stamp Duty Act.

Nami stated that since the responsibility of stamp duty payment was not that of the landlord, there was no justifiable reasons for any landlord to increase rent purportedly on account of the stamp duty which is chargeable on the instrument of the transaction, that is, the tenancy or lease agreement or receipt exchanged between the landlords and the tenant, and not the actual rent fee the landlord is collecting from tenants .

His words: “The stamp duty is charged at graduated rates. Stamp duty on rent or lease from 1 year to less than 7 years is 0.78%. If your rent is N100,000 stamp duty due on it is N780. Your stamp duty could be as low as N200 or N300 if you live in a room and parlor or in the village where rent is low. If you can afford to pay your rent between 7 to 21 years, your stamp duty is 3% on the rent. If you can afford to pay rent at once from 21 years and above the stamp duty due is 6%, which is very rare but we created room for it because some renters prefer long leases.”

“Once you’ve reached an agreement with your landlord on the amount to pay for your rent of less than 7 years, you should calculate 0.78% of the amount, go to a nearby bank and ask to pay the 0.78% into the stamp duty account. Collect the teller and tender it to your landlord to legalise your transaction with him or her.

“It is the responsibility of the landlord before he or she issues a receipt or sign a rent or lease agreement with a tenant to make sure that the tenant presents evidence of stamp duty payment. A landlord that does not insist on evidence of stamp duty payment will bear the cost of the stamp duty if the FIRS eventually finds out. You do not pay stamp duty on your own residential accommodation if you are the owner of the property even if you live in a 10-ten storey building.”

Nami also disclosed that the Finance Act 2019 has exempted 60% of taxpayers, including Small and Micro Enterprises (SMEs) from paying tax as only companies that make up to N25 million turnover now pay tax or collect Value Added Tax (VAT). This has therefore relieved millions of Nigerians and SMES, including many businesses impacted by COVID-19, of their tax obligations to the government, which is a form of long-term tax palliative to them even before the pandemic,” he added.

The FIRS chairman stressed that the global economic downturn occasioned by the coronavirus pandemic has made it necessary for the three tiers of government to close tax loopholes in the country in order to fund the budget, provide needed public infrastructure and meet overhead cost like salary payment at federal, state and local government levels.

Mr. Nami enjoined Nigerians to pay their taxes as and when due.

Stamp Duty: Landlords Must Collect, Remit 6% On Tenancy, Lease Agreement – FIRS

 

The Federal Inland Revenue Service (FIRS) has asked landlords and property agents to ensure that they charge 6 per cent Stamp Duty on all tenancy and lease agreements they enter into with all renters and remit same promptly to the Service so that they do not run foul of the Stamp Duty Act.

This follows the recent release and wide circulation of a stamp duty clarification guide by Executive Chairman, FIRS, Mr. Muhammad Nami.

According to Mr, Nami, property-related transactions like tenancy or lease agreement fall under the Ad Valorem category of the stamp duty which attracts 6 per cent duty payable in the percentage of the total value or sum of the tenancy or lease.

The burden of payment of the 6 per cent lies on the beneficiary of the tenancy or lease agreement, whom the Stamp Duty Act identified as the tenant or renter and the responsibility of collection and remittance fall on the landlord or agent in charge of the property for lease or rent,

According to a statement issued on Wednesday by Director, Communications and Liaison Department, FIRS, Abdullahi Ismaila Ahmad.

The FIRS stressed that “in any case, the party making the payment shall have the obligation to account for the applicable stamp duties.”

Some other Stamp Duty types and their rates are Appraisement or Valuation of Property, 1.5%; Certificate of Occupancy, Partnership N1,000 flat rate; Gift of Land, 1.5%; Legal Mortgage, 0.375%; Legal Mortgage (Upstamping), 0.375%; Deed of Conveyance or Transfer on Sale of Property, 1.5%; Gift of Land, 1.5%; Memorandum of Understanding (Related to Land, Sales, Joint Venture, Surrender, Subdivision Agreements, 1.5%; Power of Attorney (Irrevocable/Land Related), 1.5%; and Sales Agreement, 1.5%.

Fire Guts FIRS Office Complex In Katsina

A logo of the Federal Inland Revenue Service (FIRS)

 

A fire has gutted the office complex of the Federal Inland Revenue Service (FIRS) in Katsina State.

The incident occurred on Monday afternoon at the office complex which is located directly opposite, Muhammadu Dikko Stadium.

An eyewitness account told Channels Television via telephone that he saw men of the state fire service busy battling to extinguish the fire but one of the security guards on duty debunked the statement off camera.

He said “Indeed there was fire outbreak but it was not as it’s being exaggerated on the social media spaces.

“What Happened was not true. During the incident, electric light was not there neither the generating set operating.

“It was only our inverter room that was totally gutted by the fire. Thank God, the fire outbreak was extinguished by men of the state fire service who came with three vehicles, and within a short time it was over.”

Meanwhile, efforts to access the room where the incident happened proved abortive as the facility was totally locked by the officials.

Senate Approves N168.8bn 2020 Budget For FIRS

Senators Condemn Killing Of Briton, Demand Inter-Agency Task Force To Tackle Banditry

 

The Senate on Wednesday approved the sum of N168,809,476,220 to fund the proposed Personnel, Overhead and Capital expenditure cost of the Federal Inland Revenue Service (FIRS) for the 2020 fiscal year.

The approval came following the consideration of a report by the Senate Committee on Finance.

Chairman of the Committee, Senator Solomon Olamilekan Adeola (APC – Lagos West) while giving a summary of the 2020 budget for the FIRS said N1.56 trillion was projected for Oil revenue; N4.502 from Non-Oil revenue; N180.086 billion projected for four percent cost of Collection; N11.279 billion as projected two percent Cost of Collection ceded to the Nigeria Customs Service; N168.80 Net projected four percent Cost of Collection available rose FIRS to be appropriated by NASS; and Value Added Tax (VAT) at 7.5 percent.

READ ALSO: Senate Wants Age Review For Job Seekers

The Senate, while adopting the recommendations of the Committee’s report, called for the digitization of all processes in the administration of tax in FIRS, so as to bring the Service up-to-speed with rapidly increasing online economic activities.

The upper chamber also approved a one-off special-purpose intervention fund to the tune of N100 billion to assist the FIRS to complete its head office within 12 months; six (6) Training Schools; 30 Prototype Tax Operations Office; Purpose-built facilities for efficient taxation of Upstream Petroleum Industry and ICT Infrastructure to identify and track digital transactions.

Meanwhile, the Senate on Wednesday also confirmed the appointment of Dr. Tella Adeniran Rahmon representing Osun State as Resident Electoral Commissioner (REC).

Also confirmed was the appointment of Engr. Usman Mahmud Hassan as Commissioner of the Revenue Mobilization Allocation and Fiscal Commission (RMAFC).

The confirmation of both nominees followed the consideration of the reports of the Senate Committees on Independent National Electoral Commission (INEC); and National Planning and Economic Affairs.

The Committees are chaired by Senators Kabiru Gaya (APC – Kano South); and Olubunmi Adetumbi (APC – Ekiti North).

FIRS Extends Tax Debt Payments To August 31

FIRS Boss, Muhammad Nami

 

 

The Federal Inland Revenue Service (FIRS) has extended the closing date of tax debt payments in the country.

In a statement issued on Wednesday by FIRS Director of Communications, Abdullahi Ahmad, the agency moved its waiver of penalty and interest window on tax debts owned by individuals and businesses from June 30 to August 31st, 2020.

He noted that the agency’s boss, Muhammad Nami, approved the extension as a “follow up to a number of palliative measures devised by the FIRS to cushion the effects of the COVID-19 pandemic on the Nigerian economy.”

According to him, the move is to support tax-paying individuals and business entities in the country.

READ ALSO: Magu’s Probe Is A Question Mark On EFCC, Says Falana

“Taxpayers are advised to note that there will be no further extension of this palliative measure. Tax debtors are therefore enjoined to liquidate their outstanding tax liabilities on or before 31st August 2020 in order to enjoy a waiver of accumulated penalties and interests,” Nami was quoted as saying.

FIRS Chairman explained that the extension applies to tax auditing, investigation and desk review assessments, approved instalment payment plans under Voluntary Assets and Income Declaration Scheme (VAIDS) yet to be fully liquidated.

Nami also asked concerned individuals and businesses to contact their respective Tax Controller or the nearest FIRS Regional Debt Management Office for further enquiries.

N66bn Generated As Stamp Duty Revenue Since January – FIRS

 

A total of N66 billion has been generated as stamp duty revenue by the Federal Government between January and June 2020.

The Chairman of the Federal Inland Revenue Services, Muhammad Nami, disclosed this during the inauguration of the inter-ministerial committee on audit and recovery of back years stamp duties.

Mr Nami while giving a breakdown of the revenue added that the Finance Act has mandated the revenue agency as the sole body to receive stamp duties for the country.

“We have collected and remitted from money deposit banks in this year alone, a total of N20 billion. From Stamp Duties Revenue from stamping of instruments at CAC, we have realised about 7.9 billion. The amount now remitted as at the point I was appointed, stood at 39 billion. So, total stamp duty remitted, into federation account from January 2020 to June (as at yesterday) stood at N66 billion,” he said.

 

VAT Increase Takes Effect From February 1, FG Tells Nigerians

 

The Federal Government has said that the increase in Value Added Tax (VAT) from 5 to 7.5 percent will take effect from February 1, 2020.

This was disclosed by the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed on Thursday, during the inauguration of the Chairman and Board members of the Federal Inland Revenue Service (FIRS) in Abuja.

READ ALSO: It’s Official! Nigerians To Pay 7.5 Percent Value Added Tax

Mrs. Ahmed stated that the Finance Act had made provisions support Micro, Small and Medium Enterprises (MSMEs) and soften the effect of the VAT rate increase on companies in a bid to increase employment and boost the economy.

“I want to state that one of the key provisions in the finance act 2019 that have elicited a lot of interest is the increase in the VAT from 5% to 7.5%, and to remind us all, the finance bill has made copious provisions to improve the ease of doing business; so we have a category of companies that have turnover of 25% and below that will be paying no taxes at all, and also we have reduced tax rates for companies that have turnover from 25 million to 100 million from 30% to 30%.

“The essence of this is to encourage formalization of businesses from the informal sector and also to encourage businesses to grow and become more productive, thereby increasing employment and also meeting the commitment of Mr. President to remove 100 million Nigerians out of poverty over the next 10 years.

“The effective date for the VAT increase from 5-7.5% will be the 1st of February 2020,” she stated.

President Muhammadu Buhari last week, signed the 2020 Finance Bill into law after it had announced plans in September 2019, to review the VAT through consultations at various levels in the country.

FIRS Offers One-Month Window To Issue Tax Clearance Certificate

A file photo of the Federal Inland Revenue Service (FIRS) office in Abuja. Photo: Twitter- @firsNigeria.

 

 

The Federal Inland Revenue Service (FIRS) has offered a 30-day window to enable taxpayers in the country to obtain their Tax Clearance Certificate (TCC).

FIRS’ Executive Chairman, Muhammad Nami, announced this in a statement personally signed by him over the weekend.

The exercise is scheduled to take place between January 2 and 31, 2020.

Nami explained that the objective was to address the difficulties facing taxpayers and to assist them in meeting their obligations as they might need the TCC.

According to him, the offer to ease issuance of TCC is in accordance with the provisions of Section 101 (1) of CITA LFN 2004 and in conformity with Self-Assessment Regulation, 2011.

The FIRS boss, however, warned that FIRS would not hesitate to invoke the provisions of the law against any taxpayer found to have misled the agency to issue a TCC.

The statement read:

Following the numerous complaints received from our esteemed taxpayers with respect to difficulties encountered before obtaining Tax Clearance Certificate (TCC) and the fact that taxpayers need TCC to enable them to, inter alia, seek and obtain contracts and loans, renew permits, registrations, franchises, agreements and/or licenses that will invariably generate revenue from which taxes will be paid, Management has looked into the above complaints and has taken steps to ease the process of obtaining TCC.

Consequently, notice is hereby given that the Service has put in place machinery to issue 2020 TCC for all eligible taxpayers from 2nd January to 31st January 2020.

The Service may not hesitate to use enforcement activities including imposition of lien on bank accounts of such defaulting companies to recover any outstanding debts when it discovers that the taxpayer has misled the Service in her duty to observe tax compliance.

The issuance of TCC to ease the burden of taxpayers is in line with the provisions of Section 101 (1) of CITA LFN 2004 and in conformity with Self-Assessment Regulation, 2011.

Taxpayers are therefore encouraged to take advantage of this initiative and apply for their 2020 TCC, as soon as possible.

NIPOST Workers Protest Stamp Duty Collection By FIRS

 

Staff of the Nigeria Postal Service (NIPOST) on Thursday staged a protest over the planned takeover of the collection of stamp duties by the Federal Inland Revenue Service.

The protest took place at the Ministry of Finance, Abuja.

“We have heard that the Ministers say stamp duty is a form of tax and therefore should be collected by the FIRS,” General Secretary of the Senior Staff Association of Statutory Corporations and Government Owned Companies (SSASCGOC), Dr Ayo Olorunfemi, who led the protesters, said.

“And we wonder whether FIRS will take over the responsibility of Nigerian customs because they are collecting import duties,” he added.

 

Union leader, Dr Ayo Olorunfemi (right) at a protest rejecting the planned FIRS takeover of stamp duty collection on Thursday in Abuja.

 

On her part, the Minister of Finance, Zainab Ahmed said talks are still ongoing.

She, however, asked the protesting workers to submit a position paper on the issue.

Senate Confirms Muhammed Nami As FIRS Chairman

A file photo of the Federal Inland Revenue Service (FIRS) office in Abuja. Photo: Twitter- @firsNigeria

 

The Senate on Wednesday confirmed the nomination of Muhammed Mamman Nami as the executive chairman of the Federal Inland Revenue Service (FIRS).

The confirmation followed the consideration and approval of the report of the Senate Committee on Finance, presented at plenary by the panel chairman, Senator Solomon Adeola.

READ ALSO: Buhari Asks Senate To Confirm New FIRS Chairman, Members

The nomination of other members of the board was also confirmed by the Senate.

They include James Yakwen Ayuba, Ado Danjuma, Adam Baba Mohammed, Ikeme Osakwe, Adewale Ogunyomade and Ehile Adetola Aibangbee.

President Muhammadu Buhari had in a letter dated December 9, asked the Senate to confirm the appointment of Muhammad Nami as FIRS chairman.

According to a statement from the Senior Special Assistant to the President on Media and Publicity, Garba Shehu, Nami is a well-trained tax, accounting, and management professional with highly rated qualifications and professional practice and licenses from relevant professional bodies.

He replaces Babatunde Fowler whose term of office expired on Monday, 9th December 2019.

FIRS, AMCON: Senate To Receive Reports On Nami, Adamu Next Week

A file photo of lawmakers during plenary in the Senate Chamber of the National Assembly in Abuja.

 

 

The Senate is to receive the report on President Muhammadu Buhari’s request for the confirmation of the chairman of the Federal Inland Revenue Service (FIRS), Muhammad Nami, and members of the agency on Wednesday next week.

Similarly, it would receive the report on the President’s request for the confirmation of Edward Adamu as Chairman of the Assets Management Corporation of Nigeria (AMCON).

During plenary on Wednesday at the Upper Chamber of the National Assembly, the lawmakers referred the requests to the Senate Committee on Finance for further legislative action.


RELATED
Buhari Appoints CBN Deputy Gov, Edward Adamu, As AMCON Chairman
Buhari Asks Senate To Confirm New FIRS Chairman, Members


The committee chaired by Senator Olamilekan Adeola was directed to submit its report on December 18 before the National Assembly adjourns for the Christmas break.

Meanwhile, the lawmakers have approved the report of the Conference Committee of the Senate and House of Representatives on the Finance Bill passed by the National Assembly recently.

They also received the 2020 statutory budget proposal of the Federal Capital Territory Administration (FCTA).

In a letter dated December 10, 2019, and addressed to the President of the Senate, Ahmad Lawan, President Buhari requested the National Assembly to consider the 2020 budget proposal of the FCTA.

He explained that the request to the Senate was in compliance with Sections 121 and 299 of the 1999 Constitution (as amended).

The letter read: “Pursuant to Sections 121 and 299 of the 1999 Constitution of the Federal Republic of Nigeria (as amended), I forward herewith, the 2020 statutory budget proposal of the Federal Capital Territory Administration, for the kind consideration and passage by the Senate.

“While hoping that this submission will receive the usual expeditious consideration of the Senate, please accept, Distinguished Senate President, the assurances of my highest consideration.”

Buhari Asks Senate To Confirm New FIRS Chairman, Members

A file photo of the Federal Inland Revenue Service (FIRS) office in Abuja. Photo: Twitter- @firsNigeria

 

 

President Muhammadu Buhari has asked the Senate to confirm the appointment of the chairman and members of the Federal Inland Revenue Service (FIRS).

His message was conveyed in a letter which was read out by the Senate President, Ahmad Lawan, at the start of plenary on Tuesday in the upper chamber of the National Assembly.

This comes a day after the Presidency announced the appointment of Muhammad Nami as the new Executive Chairman of the FIRS.

READ ALSO: Buhari Nominates Muhammad Nami To Replace Babatunde Fowler As FIRS Boss

The request, President Buhari said, was pursuant to Section 3(2) of the Federal Inland Revenue Service (Establishment) Act, 2007.

The letter reads: “Pursuant to Section 3(2) of the Federal Inland Revenue Service (Establishment) Act, 2007, I am pleased to forward for confirmation by the Senate, the underlisted names of nominees as the Chairman and Members of the Federal Inland Revenue Service.”

Members and representatives of geopolitical zones appointed include James Ayuba – Member (North Central); Ado Danjuma – Member (North West), and Adam Mohammad – Member (North East).

Others are Ikeme Osakwe – Member (South East), Adewale Ogunyomade – Member (South West), and Ehile Aigbangbee – Member (South-South).

Representatives of MDAs also nominated are Ladidi Mohammad – Member, Attorney-General of the Federation; Godwin Emefiele – Member, Central Bank of Nigeria (CBN); Fatima Hayatu – Member, Ministry of Finance, and Maagbe Adaa – Member, Revenue Mobilisation Allocation and Fiscal Commission (RMAFC)

Others are Umar Ajiya – Member, Nigerian National Petroleum Commission (NNPC); DCG T.M lsah – Member, Nigerian Customs Service (NCS) and Registrar General – Member Corporate Affairs Commission (CAC).