Nigeria: Stamp tax on teller deposits, electronic transfers by banks

Nigeria: Stamp tax on teller deposits

The Federal High Court (Asaba division) issued a decision holding that a bank’s collection of stamp taxes (duties) on teller deposits or electronic transfers prior to the 2019 amendment of the Stamp Duty Act was arbitrary, unlawful, and illegal. The court awarded damages to the plaintiff (a bank account holder).


The case is: Rupert Irikefe (trading as Abimbola Energy Ventures) v. Central Bank of Nigeria, et. al. (9 December 2020)


The plaintiff had an account with the bank. The bank made several deductions of ₦50 and ₦100 from the plaintiff’s account between 2016 and 2018.

In 2018, the plaintiff approached the bank’s offices to inquire about the basis of the stamp taxes charged on his current account. The bank referred him to the Federal High Court’s decision, Kasmal International Service Ltd. v. Standard Chartered Bank Nig. Ltd (No.: FHC/L/CS/1462/2013), which the bank claimed supported its deductions.

The plaintiff countered with other court decisions, wherein those courts held that there was no express provision in the Stamp Duty Act or any other law imposing any obligation on the bank to collect and remit ₦50 as stamp taxes on teller deposits or electronic transfers in amounts of ₦1,000 or greater. The plaintiff requested that the bank refrain from deducting stamp taxes from his account and to refund the amounts already deducted. The bank refused to return the deducted amounts and continued to charge stamp taxes on the plaintiff’s account.

The plaintiff filed suit and eventually, the matter ended up before the Federal High Court which rejected the bank’s collection of stamp taxes on teller deposits or on electronic transfers of monies. 

KPMG observation

The decision in this case applies only with regard to periods before amendments by the Finance Act, 2019 became effective. Beginning 13 January 2020, all electronic receipts or transfers of ₦10,000 or more for all types of bank accounts in Nigeria are subject to stamp tax (duty) of ₦50. This is in line with a new measure (Section 89(3)) added to the Stamp Duty Act by the Finance Act, 2019.

Read a January 2021 report [PDF 917 KB] prepared by the KPMG member firm in Nigeria

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