Through the Electronic Money Transfer Levy, the Federal Government expects to generate N483.73 billion in revenue from the surge in electronic payments over the course of three years.
In its Medium Term Expenditure Framework and Fiscal Strategy Paper for 2023–2025, the Budget Office of the Federation produced this forecast.
The Stamp Duty Act was modified by the Finance Act 2020 to include the EMTL in order to take advantage of the country’s expanding use of electronic payments transfers.
A single, one-time fee of N50 is applied to any amount above N10,000 that is electronically received or transferred from any bank or financial institution that accepts deposits.
The three tiers of government share the EMTL’s revenue.
The country aims to make at least N137.03 billion in 2023, N157.59 billion in 2024, and N189.11 billion through EMTL, according to the budget office, which is under the Ministry of Finance, Budget, and National Planning.
The office also disclosed that in 2021, the fee brought in N111.84 billion for the government. Due to widespread use, expanded broadband availability, and enhanced payment gateway dependability, e-payment transactions have surged dramatically since the start of the pandemic.
The overall value of electronic transactions in the first four months of 2022 (N117.33tn) is already more than the total number of transactions in 2019 according to data from the Nigeria Inter-Bank Settlement System webpage (N108.42tn).
It was N162.89 trillion in 2020 and N278.38 trillion in 2021. The NIBSS reports that as more people switched to using electronic channels for money transfers after the epidemic, adoption payments for e-payments increased.
The COVID-19 pandemic, according to the International Monetary Fund, raised the value of mobile money transactions in the country to 9.72% of the GDP in 2020.
In a previous interview with The PUNCH, Lilian Phido, the head of corporate communications at NIBBS, discussed this growth and stated, “It is very clear that more and more people are accepting the channels of payment that are available and the platforms are stable.
“With stability, these components have grown. With stability more and more people moving.”
Commenting on the government’s projection, the National President, Association of Mobile Money Agents in Nigeria, Victor Olojo, said, “Yes it will continue to increase with the boom. With what I know about the levy, it is a stamp duty championed by the Nigerian Postal Service for the Federal Government.
“It is a huge meaningful source of revenue to them, although it might not be as significant. For every transaction above N10,000 that enters your account, the stamp duty is automatically deducted. It is a big win for the Federal Government.”
“However, it has an impact on businesses. For some merchants, say a supermarket that does about 100 transactions in a day and gets charged N50 on each transaction, this is away from the cost of running the business. It would have been nice if the value of this N50 payment is seen in form of basic amenities.
“Presently, it appears like a rip-off as businesses still have to pay taxes, Value Added Tax, without commensurate impact. It has a negative impact on businesses since there is no visible impact.”