Revision of Stamp Duty on NSE Transactions to 0.08% from 0.075% Effective 7th December 2020

Saturday November 21, 2020 / 12:50 PM / by Afrinvest / HeaderImage Credit: NSE

Further to the Public Notice by the Federal Inland Revenue Service ("FIRS") on Monday, 20^th July, 2020 itemizing Contract Notes at an ad valorem rate of 0.08%,please be notified of an adjustment in Stamp Duties charged on transactionscarried out via the Nigerian Stock Exchange ("NSE") from 0.075% to 0.08%,effective 7^th December 2020.

The CentralSecurities Clearing System Plc. (CSCS) will adjust its system to implement theautomated deduction of the Stamp Duty rate of 0.08% on the effective date.

Below is the content of the circular from the NSE

Administration of Stamp Duty onSecurities Transactions

We refer to the Public Notice in the Business DayNewspaper of Monday, 20 July 2020, captioned 'Clarification of Administrationof Stamp Duties in Nigeria' issued by the Federal Inland Revenue Service (FIRS)(A copy is attached as Appendix A for ease of reference).

The Public Notice provided, amongst other things,information on dutiable instruments and the applicable flat or ad valoremrates, with Contract Notes1 itemized at an ad valorem rate of 0.08%. As youknow, this is at variance with the current rate of 0.075% being administered inthe Nigerian Capital Market.

To that extent, Dealing Members of The Nigerian StockExchange are to note the following:

1. Effective 7 December 2020, the Central SecuritiesClearing System Plc. (CSCS) will adjust its system to implement the automateddeduction of the Stamp Duty rate of 0.08%;

2. Dealing Members are required to immediately engagetheir software vendors for the required adjustments to their technologyapplications, to reflect the 0.08% rate ahead of the effective date of 7December 2020; and

3. Dealing Members are required to communicate thechanges above to their clients immediately, ahead of the effective date.