The federal government (FG) has directed commercial banks in the country to start deducting Electronic Money Transfer Levy (EMTL) on foreign currency transactions.
TheNewsGuru.com (TNG) reports the FG gave the directive through a circular by the Federal Inland Revenue Service (FIRS) to the commercial banks.
This follows implementation of the Finance Act 2020, Section 48 and Stamp Duties Act 2004 Section 89A (1) as amended, which imposes a levy referred to as Electronic Money Transfer Levy (EMTL) on electronic receipts on transfers for money deposited in any deposit money bank or financial institution, on any type of account.
Already, the commercial banks have started sending notices for implementation of the deductions to their customers, who own domiciliary accounts.
According to the notice, the deductions will be retrospectively implemented from January 2021 when the Finance Act, 2020 became effective.
One of such notices by Zenith Bank reads: “Dear Valued Customer, we have been mandated by the Federal Inland Revenue Service (FIRS) to deduct and remit Electronic Money Transfer Levy (EMTL) on foreign currency denominated inflows into your account in line with the provisions of the Finance Act 2020, Section 48 and Stamp Duties Act 2004 Section 89A (1) as amended which imposes a levy referred to as Electronic Money Transfer Levy (EMTL) on electronic receipts on transfers for money deposited in any deposit money bank or financial institution, on any type of account.
“While the bank has been implementing provisions of the Acts on Naira denominated inflows, the directive from FIRS has mandated us to extend the levy to foreign currency inflows equivalent of #10,000 and above, and charged at equivalent of #50.00 per transaction.
“The FIRS further directed that this levy be retrospectively implemented from January 2021 when the Finance Act, 2020 became effective.
“Please note that FGN Electronic Money Transfer Levy is a statutory levy payable wholly to Federal Government and not to Zenith Bank Plc”.
However, the Minister of Finance and Coordinating Minister for the Economy, Wale Edun, who disclosed the intentions of the FG, said forceful measures would not be imposed.
Edun said the government’s intention was to encourage investments by incentivising the release of funds from these accounts.
“There is a lot of FX liquidity in Nigeria and the federal government would take steps to make holders of such accounts release the money.
“The government would not force holders of such accounts to give them up but would provide incentives to enable them invest in attractive instruments, going forward,” Edun said.