Court Rules Stamp Duty on Bank Transactions Illegal, CBN Approves New Payment System License

A Federal High Court sitting in Asaba Delta State has ruled that it’s illegal for banks to charge depositors N50 stamp duty.

The ruling delivered on December 9 puts an end to the controversial policy introduced by the Central Bank of Nigeria (CBN) earlier. The presiding Judge, Justice Nnamdi Dimgba said in the verdict that the CBN and all banks should immediately stop further collections of stamp duty fees from Nigerians because the Stamp Duties Act does not have provision for such taxes.

“… there was no express provision in the Stamp Duties Act or any law authorizing the deduction or imposing any obligation to deduct and remit N50 as stamp duty on teller deposits or electronic transfers of monies from N1,000 (one thousand naira upwards and accordingly nullified same, the conduct of the 1st and 2nd defendants in continuing to impose, direct the imposition, receive and or charge, deduct or remit the said sum of N50 as stamp duty on teller deposits or electronic transfers of money transactions from N1,000 upwards from the account of the plaintiff domiciled with the 2nd defendant is wrong in law, dismissive and contemptuous of the lawful orders of superior courts of competent jurisdiction, condemnable, null and void and of no effect,” the court’s judgment said.

A Nigerian businessman, Rupert Irikefe had, last year, filed a suit against the CBN, Attorney-General of the Federation and Zenith Bank, challenging the decision to impose N50 stamp duty charge on depositors.

Following CBN’s directive, Nigerian banks have been charging N50 on transactions above N1,000, a development that was seen as exploitation by depositors.

The court awarded Irikefe N50,000,000 in damages for the inconveniences and pains caused by the unlawful and arbitrary imposition of the N50 stamp duty on his account.