Stamp Duty: Malami writes 36 governors, insists on compliance

From Godwin Tsa, Abuja

The Attorney General of the Federation and Minister of Justice, Abubakar Malami, has directed the 36 governors of the federation to comply with the audit and recovery of back years of stamp duty from January 15, 2016, to June 30, 2020.

The directive which was contained in the letters already dispatched to all the state governors is predicated on the provision of section 111 of the Stamp Duty Act, which exclusively empowers the AGF to recover any outstanding payment or remittance relating to Stamp duty.

Recalled that the 36 states of the federation had, through their Attorneys-General, dragged the Federal Government to the Supreme Court over alleged failure to remit funds generated from stamp duties into state accounts.

In the suit marked SC/CV/690/2021, the states are contending that they are legally vested with the authority to administer and collect stamp duties on all transactions involving individuals and persons within their territories, and not FG.

They are further praying the court for an order, directing FG to account for and pay back all monies collected by way of stamp duties on individual persons’ transactions within their respective states, from 2015 to 2020 and thereafter till the time of the judgment.

The states are seeking an order of the court directing the defendant to pay over to the Plaintiffs all the sum of monies amounting to One Hundred and Seventy-Six Billion, Sixty Seven Million, Four Hundred Thousand Naira (N 176,067,400,000,00) representing ascertained and admitted collected stamp duties on individual persons’ transactions within their respective states for the period of 2015- 2020 and thereafter till the time of the judgment of this honourable court or any other sum as the plaintiffs may be found entitled by the honourable court.

But the AGF in his letters to the state governors urged them to comply with the audit and recovery of the outstanding stamp duties.

This was disclosed on Wednesday through a statement by the Special Assistant on Media and Public Relations to the AGF, Dr Umar Gwandu.

According to his statement: ‘Pursuant to Mr President’s approval and directives, I also wish to request Your Excellency to direct the State Ministries, Departments, Agencies, and Regulatory Institutions of Financial Sector to engage and grant access to the appointed Recovery Agents for the purpose of the Audit and Recovery of Stamp Duty to ensure that all established liabilities are remitted as appropriate.

‘The recoveries are being conducted for the Federal Ministries, Departments, Agencies and Financial Institutions. At this stage, liabilities are being established, and no actual recovery has been made.’

According to the statement, Section 111 of the Stamp Duty Act granted the Attorney General of the Federation an exclusive power to recover any outstanding payment or remittances related to stamp duty.

The letters were written pursuant to the provision of Section 111 of the Stamp Duty Act which provides that ‘all duties, fines, penalties and debts due to the Government of the Federation imposed by this Act shall be recoverable in a summary manner in the name of the Attorney General of the Federation or the state.’

Gwandu said what the Attorney General of the Federation did was to activate those powers, conduct the audit and recovery of back years stamp duty in collaboration with stakeholders.

He said the Federal Government of Nigeria has set up an Inter-Ministerial Committee on Audit and Recovery of Back years Stamp Duties from 15th January 2016 to 30th June 2020.

Members of the committee were drawn from the Office of the Attorney General of the Federation and Minister of Justice in collaboration with relevant agencies including the Office of the Secretary to the Government of the Federation, Federal Inland Revenue Service, Office of the Accountant General of the Federation, Ministry of Finance, Central Bank of Nigeria, Revenue Mobilisation and Fiscal Allocation Commission, among others.

The statement said in view of the need to provide a comprehensive overview of the process and to proper understanding the task, the Attorney General of the Federation organised a meeting with Attorneys General of States for they have similar powers with respect to stamp duty of Ministries, Departments, Agencies and Financial Institutions in their respective states.

‘Regardless, before the Supreme Court, the state governors are urging the court to determine; “Whether having regard to the provisions of Section 4(2) of the Stamp Duties Act Cap. S8 of the Laws of the Federation of Nigeria read in conjunction with the provisions of Section 163, items 58 and 59 of the Second Schedule part I and items 7 (a) and (b) of the second Schedule part II and other provisions of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), the defendant (Malami) could claim, retain, distribute or in any other manner deal with the monies or sums collected as stamp duties on individual person’s transactions within the respective states of the plaintiffs without reference to, the concurrence of, input or agreement of the plaintiffs?

‘Whether having regard to the mandatory provisions of Section 4(2) of the Stamp Duties Act Cap. S8 Laws of the Federation of Nigeria (LFN), the plaintiffs (all the state attorneys) are not the sole authority to administer and collect stamp duties on all transactions involving individuals/persons within their respective states?

‘To ascertain whether or not states are entitled to 85% of all stamp duties collected on electronic money transfer levy, on electronic receipts or electronic transfer for money deposited in deposit money banks and financial institutions, on any type of account to be accounted for and expressed to be received by the person to whom the transfer or deposit is made in the plaintiffs’ respective states.

‘Upon determination of the legal questions, the states want the Supreme Court to declare that they are the sole authorities entitled to administer and collect stamp duties on all transactions involving individuals within their respective states.’

They are also seeking a ‘declaration that the defendant is not entitled to collect, administer, or keep the proceeds of any stamp duties on transactions involving individuals within the respective states of the plaintiffs or any manner interfere with the Plaintiff’s right and authority in the administering the provision of Section 4(2) of the Stamp Duties Act Cap. S8 Laws of the Federation of Nigeria.

‘A declaration that the plaintiffs are entitled to all the sums of money collected by the defendant as stamp duties through whatever source or means in their respective states from 2015-2020 and thereafter till the time of the judgment of this honourable court with respect to individual persons’ transactions.

‘A declaration that the plaintiffs are entitled to 85% of all stamp duties collected on electronic money transfer levy, on electronic receipts or electronic transfer for money deposited in deposit money banks and financial institutions, on any type of account to be accounted for and expressed to be received by the person to whom the transfer or deposit is made in the plaintiffs’ respective states.

‘An order of perpetual injunction restraining the defendant, by himself, privies, agents or any persons by whatever name or howsoever called from appointing anyone for the purpose of collecting Stamp Duties on individual persons’ transactions within the respective states of the plaintiffs henceforth.’

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