The House of Representatives has passed the Finance Act, 2024 which seeks to impose a 70 per cent tax on the profits made by banks from all foreign exchange transactions.
The resolution of the House followed the adoption of the report presented by Chairman, House Committee on Finance, Hon. James Faleke at the plenary on Tuesday.
The Executive bill was adopted by members at the Committee of Supply chaired by the Speaker, Hon. Tajudeen Abbas
The House also approved the imposition of windfall tax, assessment and review of profits declarations; and for deferred payment agreements for financial institutions by Federal Inland Revenue Service (FIRS).
Faleke said the Committee interacted with some stakeholders including: Federal Ministry of Finance and Coordinating Economy, Central Bank of Nigeria (CBN), Federal Inland Revenue Service (FIRS) and Bankers Committee.
He explained that the Joint Committee observed that the Banks enjoyed windfall as a result of exchange rate unification policy of the federal government;
Faleke said: “That the windfall was as a result of FX allocation to selected commercial Banks.
“That the policy does not permit the use of the windfall for dividend payment.
“That levy shall be 70 percent on the realized profit from all exchange transactions of Banks.
“Any bank that fails to pay the windfall profit levy to the Service and has not executed a deferred payment agreement by 31st December, 2024, shall be liable to pay the windfall profit levy withheld or not remitted in addition to a fine of 10% of the levy withheld or not remitted per annum and interest at the prevailing Central Bank of Nigeria (CBN) minimum rediscount rate.”
