December 31, (THEWILL) — Nigeria’s recent tax reforms created the Nigerian Tax Act (NTA) 2025 which is among the new tax laws with January 1, 2026, as the implementation date.
The NTA affected two existing fiscal rules namely, the Stamp Duty Act and the Electronic Money Transfer Levy (EMTL).
Stamp Duty is a tax levied by the government on specific legal documents and transactions, most commonly the purchase or transfer of property, land and certain financial securities.
The EMTL is imposed on electronic money transfer transactions of N10,000 and above is meant to be borne by the receiver; the amount is N50 per transaction.
Although the receiver was subsequently exempted from the levy, there was confusion as the sender and the receiver were both billed N50 for each transaction by some financial institutions.
When the EMTL was introduced via the Finance Act of 2019/2020, transactions through the financial technology (fintech) channels were exempted.
But this was reversed in August 2024 to include mobile money, internet banking and other electronic payment methods.
Before now, both the Stamp Duty and the EMTL were standalone rules.
The new tax regime has unified the two fiscal rules in a way that the EMTL is now ‘swallowed’ up by the Stamp Duty Act which has widened its scope.
The new tax regime has, consequently, updated and consolidated the laws on Stamp Duty by primarily replacing the EMTL and clarifying its scope.
By this change, the NTA 2025 repeals the previous standalone Stamp Duty Act and integrates all provisions into a single, unified statute, aiming to simplify the overall tax framework.
It also integrates the provisions of the former EMTL.
The N50 levy on electronic transfers of ₦10,000 and above is now formally referred to as stamp duty.
A significant change is that the sender of an electronic transfer of ₦10,000 or more is now responsible for paying the ₦50 charge, rather than the recipient as was the previous practice with the EMTL.
The stamp duty rate for agreements and contracts has been fixed at ₦1,000, moving away from a potentially complex ad-valorem (percentage-based) system for these specific instruments.
Certain transactions are exempt from the ₦50 stamp duty on electronic transfers. These include:
Transfers or deposits of less than ₦10,000.
Salary payments.
Transfers between a person’s own accounts within the same bank (provided the account names and identification details match).
Unstamped documents, whether physical or electronic, are inadmissible as evidence in Nigerian civil court proceedings.
Revenue from the electronic transfer levy (now referred to as stamp duty on bank transfers) is shared among the three tiers of government with a formula of 15 percent for the Federal Government/FCT, 50 percent for State Governments, and 35 percent for Local Governments.
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.
