A CRITICAL EVALUATION OF STAMP DUTY AS A CATALYST FOR ECONOMIC DEVELOPMENT IN NIGERIA: A PRAGMATIC APPROACH

Abstract

The primary objective of this study is to examine the effective and efficient assessment and collection of stamp duty tax in Nigeria. Stamp duty tax is a tax imposed on both written and electronic instrument such as conveyance on sale, admission, bill of exchange, bill of lading, receipt, apprenticeship, charter party, hire purchase, contract note, promisory note, marketable securities etc. Recently, the Finance Act 2020 expanded the scope of stamp duty to include Electronic Money Transfer Levy (EMTL) for every bank deposit up to the tune of N10,000 and above for N50 charge (one off). The mode of assessment of stamp duty is either a fixed flat rate or alvalorem basis on the instrument. The relevant tax authority for the assessment and collection of stamp duty tax in Nigeria are the Federal Inland Revenue Service (FIRS) and State Internal Revenue Service (IRS). The inherent challenges of stamp duty are the acceptance of fake stamp duty instrument without verification and lack of awareness by taxpayers among others. The recommendation is continuous enlightenment of taxpayers on the existence and inport of stamp duty tax as well as the review and simplification of the stamp duty Act 2004 to reflect current economic realities.