FG Projects N136bn Revenue From Electronic Money Transfers in 2023
The Budget Office of the Federation (BFO) has projected that in 2023, the Nigerian government will generate N136.3 billion as revenue from a projected 2.7 billion volume of eligible online transfers....
The Budget Office of the Federation (BFO) has projected that in 2023, the Nigerian government will generate N136.3 billion as revenue from a projected 2.7 billion volume of eligible online transfers. The revenue, according to BFO, will be earned from transactions made by bank customers from Electronic Money Transfers (EMT).
The EMT levy was introduced in the Finance Act 2020, as an amendment to the stamp duty act.
It was meant to latch onto the economic boom witnessed in the fast-growing world of electronic funds transfer in Nigeria.
The EMT levy is a N50 payment which represents a singular and one-off charge on electronic receipt or money transfer which is deposited in any deposit money bank or financial institution on sums of N10,000 or more.
The revenue from the EMT levy is shared between the Federal Government and Federal Capital Territory at 15 percent, the state governments at 50 percent while the local government areas take a 35 percent share.
The 2023 projection was disclosed by the BFO during its 2023-2025 Medium Term Expenditure Framework and Fiscal Strategy paper released recently.
The body revealed that in order to give strong backing to the revenue collection from EMT, they will be relying on the recently approved regulations governing the administration of the Electronic Money Transfer Levy (EMTL),
While it aims to target banks and other financial institutions as sources of the ETML, the government added it would also ensure the proper monitoring of these institutions to conduct reconciliation and to ensure deduction and remittance of the levy.
The Levy however has come with its own controversies as economists have questioned its legitimacy.
The Chairman of the Foundation for Economic Research and Training, Professor Akpan Ekpo, had described as ‘worrisome’ the proposed levy on users of formal financial services.
He said, “The levy is remitted to the government, which is fine. But I think the savers, the people who use the transfer channels, are over-levied. You pay a maintenance fee, transfer fee, and I think if this level of levying continues, it will discourage people from using electronic channels”.
In 2021, the World Bank had made a projection of N462 billion from the electronic money transfer levy as a source of stable revenue for Nigeria while the FG had projected N500 billion.
The FG had during the same period, realized just N111.84 billion at the end of the year.
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