It has been revealed that bank users must provide their evidence of tax payment as a condition for operating a bank account as from January, according to the financial bill passed by the National Assembly.
Contained in the Bill submitted to the lawmakers with Budget 2020 by President of the federal republic of Nigeria, Gen. Muhammadu Buhari, is designed to improve financial operations of the country and streamline the Nigeria tax regime.
It is expected to be signed with the budget before end of the month, to actualize the return to the January – December budget cycle.
According to a section of the Bill, banks will require anybody opening an account to provide his Tax Identification Number (TIN)
It is also mandated that those who already have accounts with banks will also be required to provide their TIN.
It was also disclosed that there are 30 million Bank Verification Numbers (BVN)-linked accounts, and the intention is to make sure that more people are captured into the tax net.
According to the Joint Tax Board, the tax identification number (TIN) is a unique identifier for an individual or a company for tax remittance.
The TIN is prepared by the tax office and issued for proper identification and verification.
Applying for TIN is free. The TIN generation process is real-time and should not exceed 48 hours after a request is submitted.
The bill will also strategically “promote fiscal equity by mitigating instances of regressive taxation; reform domestic tax laws to align with global best practices; introduce tax incentives for investments in infrastructure and capital markets; support small businesses in line with the ongoing Ease of Doing Business Reforms; and raise revenues for the Government by various fiscal measures.”
The bill will come up with a penalty for failure to deduct tax by agents appointed for tax deduction. This penalty is 10 per cent of the tax not deducted, plus interest at the prevailing monetary policy rate of the Central Bank of Nigeria (CBN).
