A new bill proposes significant changes to Nigeria’s financial landscape, requiring individuals and entities involved in banking, insurance, stockbroking, or other financial services to provide a Tax Identification Number (TIN) before opening new accounts or operating existing ones. The legislation aims to enhance tax compliance and boost revenue collection.
Key provisions of the bill include.
- Mandatory TIN for Financial Services: All individuals and entities engaged in financial services in Nigeria will be required to have a TIN before opening or operating bank accounts.
- Non-Resident Tax Registration: Non-resident individuals supplying taxable goods or services to Nigeria or deriving income from the country must register for tax and obtain a TIN. However, those with solely passive investment income are exempt from registration but must provide necessary information to the tax authority.
- Automatic Tax Registration: The tax authority has the power to automatically register and issue a TIN to individuals who fail to comply with registration requirements.
- Penalties for Non-Compliance: Failure to register for tax will result in administrative penalties, starting at N50,000 for the first month of non-compliance and increasing by N25,000 for each subsequent month.
The proposed bill, if enacted, will have a significant impact on Nigeria’s financial sector and tax administration, as it seeks to strengthen the government’s ability to collect revenue and ensure that all individuals and entities are contributing their fair share.