Bank Directors Beg National Assembly To Reconsider 70% Windfall Tax

Bank Directors have urged the National Assembly to reconsider the 70% Windfall Tax.

 

NewsOnline Nigeria reports that the Bank Directors Association of Nigeria, (BDAN) has called on the National Assembly to revisit the 70% windfall tax amendment on the finance act saying it is ill-timed and burdensome in light of recent recapitalisation efforts in the banking sector.  

 

After its meeting, the group stated this in a statement where it called on the National Assembly to engage in constructive discussion while revisiting the amendments.  

 

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The group in the statement also sought further explanation on what constitutes the FX gains to be taxed and how the federal government plans to address banks which record losses rather than profits.  

 

It stated, “is excessively burdensome and ill-timed, particularly considering the ongoing bank-recapitalization efforts,” 

“We respectfully urge the National Assembly to revisit these amendments and engage in constructive discussion.” 

“Such a high levy has the potential to stifle growth and innovation within the banking sector,”  

 

“We also request clarification on what constitutes foreign-exchange transactions to be taxed and the treatment of banks that may incur losses rather than gains,” 

NewsOnline Nigeria reported that last month, the federal government sent an amendment to the 2023 Finance Act which introduced a 50% windfall tax on the foreign exchange revaluation gains by Nigerian banks.  

 

According to the Federal government, funds from the windfall tax will be used to fund infrastructure projects across the country as well as social intervention programs in the 2024 budget.  

 

The National Assembly upon deliberation on the bill increased the windfall levy to from the proposed 50% to 70% of banks’ foreign exchange revaluation gains until 2025.