The federal government plans to tax banks 50% of profit realised from foreign exchange revaluation in 2023.
This is contained in the proposed amendments to the 2023 Finance Act sent by the President to the National Assembly for approval.
Revenues from the proposed windfall tax as stated in the letter from the President to the Senate are to be deployed to “Renewed Hope”infrastructure projects, education, healthcare etc.
According to the document obtained by Nairametrics, The tax on foreign exchange gains described as “windfall tax” shall be collected by the Federal Inland Revenue Service (FIRS).
It stated, “There shall be levied and paid to the benefit of the Federal Government of Nigeria a tax of 50% on the realised profits from all foreign exchange transactions of banks within the 2023 financial year.”
“The Federal Inland Revenue Service – (a) shall assess the realised profits, collect, account and enforce payment of tax payable under section 30 in accordance with the powers of the Service under the Federal Inland Revenue Service (Establishment) Act 2007;”
The amendment further that the failure of banks to remit the recommended sum to the appropriate authority will upon conviction pay the tax withheld and 10% of the withheld tax coupled with interest at the Central Bank of Nigeria (CBN) minimum discount rate or risk imprisonment of key principal officials.
(Nairametrics)
