As reported by the Nigerian newspaper, the Punch, Nigerian legislators recently introduced a bill that would compel individuals in banking, insurance, stockbroking, or other financial services to provide a Tax Identification Number as a prerequisite for opening a new bank account or managing an existing one.
The bill states, “A person engaged in banking, insurance, stock-broking, or other financial services in Nigeria shall make the provision of a tax ID, a precondition for opening a new account or operating an existing account.”
According to the Punch’s report, the bill adds that any non-residents who offer taxable products or services to Nigerians or generate revenue from the country must register for tax purposes and get the ID number.
However, non-residents who via their investments in Nigeria generate passive income, would be exempted from getting the ID, but would be mandated to give appropriate information no less.
The proposed legislation also allows the relevant tax authorities to automatically register and issue a Tax ID to those who should have applied but did not.
Disregarding this new rule, should it pass, would lead to financial penalties.
Those who are considered taxable, should they fail to obtain the ID, would have to pay N50,000 in the first month, after which a N25,000 fine would be attached to subsequent months that they continue to shun the tax registration.
The Bill titled “A Bill for an Act to Provide for the Assessment, Collection of, and Accounting for Revenue Accruing to the Federation, Federal, States, and Local Governments; Prescribe the Powers and Functions of Tax Authorities, and for Related Matters”, would generate more tax revenue via tax compliance, according to the government.
