June 01, (THEWILL) – Nigerian banks have begun implementing a new regulation that requires customers to present a valid Tax Clearance Certificate (TCC) for foreign exchange transactions.
The move complies with new regulations by the federal and state governments, which aim to ensure tax compliance in line with the provisions of the Personal Income Tax Act.
The federal and state governments have also mandated Ministries, Departments and Agencies of Government (MDAs) to henceforth, implement the demand for a valid Tax Clearance Certificate (TCC) as a prerequisite for carrying out any business transaction with individuals and organisations in the country.
To this effect, some banks have already conveyed the development to their customers through text messages and e-mail.
According to a message by Fidelity Bank which was seen by this newspaper, the regulation covers forex applications for PTA/BTA, school fees, maintenance expenses and medicals.
THEWILL also learnt that government loans, registration of motor vehicles, applications for foreign exchange or exchange control permission, certificate of occupancy, award of contracts by the government, and its agencies, and registered companies are among the affected transactions as directed by the federal and state governments.
Other transactions subject to proof of TCC include approval of building plans, trade licence, transfer of real property, agent license, pools or gaming license, registration as a contractor, application for distributorship, confirmation of appointment by the government as chairman or member of a public board, institution, commission, company or to any other similar position made by the government.
Also affected affected are stamping of guarantor’s form for a Nigerian passport, application for registration of a limited liability company or of a business name, allocation of market stalls, appointment or election into public office, application for change of ownership of a vehicle by the vendor, plot of land, FCTA loan and any other as may be determined from time to time.
Under the new directive, MDAs, banks, and corporate bodies must ensure all presented TCC go through a rigorous verification process by the issuing tax authority to ascertain their authenticity.
THEWILL learnt that some middle-men popularly called touts have emerged to act as facilitators between applicants and tax offices which are now besieged by persons applying for TCC for various transactions in the banks and government offices.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
