THE Executive Chairman, Federal Inland Revenue Service, Muhammad Nami, on Monday, assured tenants that the Service was working on a Stamp Duty palliative package for them in view of the current economic realities occasioned by the COVID-19 pandemic.
Nami said this in a statement issued by the Director, Communications and Liaison Department, FIRS, Abdullahi Ismaila Ahmad.
The Service had last week said that the six per cent Stamp Duty was for tenancy above 21 years, while seven to 21 years lease or tenancy would attract three per cent and less. For tenency that is less than seven years, the Stamp Duty was pegged at one per cent.
As part of the palliatives, the Executive Chairman hinted that Stamp Duty would not be collected in arrears from tenants, even as he told his interviewers that there was never a time when taxation was convenient for everybody to pay.
The Executive Chairman stated that the FIRS was aware that many taxable Nigerians and businesses in the country were going through difficulties imposed by COVID-19, noting that the FIRS had consistently rolled out tax-related palliatives to relieve them of their tax liabilities.
Nami added that, contrary to some false claims in certain quarters, Stamp Duty was not a creation of the current administration of President Muhammadu Buhari or the current leadership of the FIRS.
He said, “Stamp Duty dates back to colonial times in Nigeria. It has been a form of tax in Nigeria as far back as 1939 when you and I were not yet born. It was codified in our laws in 1953, that is before independence. It was consolidated in 2002, published in 2006 and further reworked into the Stamp Duty Act 2004.
“The Joint Tax Board where states are represented consider it necessary to bring the stamp duty act to the attention of Nigerians, following the recent launch of the Inter-Ministerial Committee on Audit and Recovery of Back Years Stamp Duties where the new FIRS Adhesive Stamp Duty was unveiled.”
“As chairman of the JTB, the FIRS was mandated to enlighten Nigerians on stamp duty. That’s why the FIRS published a clarification notice on the stamp duty and we shall continue to educate the public on it,” he added.
For purpose of clarity, he said that the six per cent Stamp Duty rate was not chargeable across board.
He added, “It is only chargeable on rent or lease agreement of above 21 years. If your rent or lease is between seven and 21 years, the Stamp Duty rate is three per cent.
” And if you pay your rent monthly or yearly, that is less than seven years, your stamp duty rate is 0.78 per cent. The 0.78 per cent is the rate for most tenants like you and I who live in Suleja or Minna. If your rent is N100,000 like you said, you only pay 0.78 per cent, which is marginal.”
According to him, those who live in Maitama who pay N10m as rent, will pay more at the same 0.78 per cent because their rent is higher than those in other parts of Abuja.
Nami allayed the fear that Stamp Duty would lead to rent increase, saying, “Stamp duty should not make any landlord to increase his or her rent because it is not paid by the landlord. Landlords are not our collecting agents.”
