Fintech companies, including OPay, Moniepoint and others, have announced plans to begin deduction of N50 Electronic Money Transfer Levy (EMTL) from transactions of N10,000 and above with effect from tomorrow, September 9th
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This deduction followed a directive by the Federal Inland Revenue Service (FIRS).
The mandatory deduction will bring an end to the era of free banking services provided by fintechs, though the charges are remitted to the federal government.
This levy is, among others, primarily designed to generate revenue for the government. The Finance Act, 2019 amended various subsets of the existing tax and fiscal legislation at the time, including the Stamp Duty Act (SDA).
Recall that in December 2023, the FIRS directed deposit money banks to deduct and remit Electronic Money Transfer Levy (EMTL) on foreign currency (FCY) transactions going forward. Within the first five months of this year, a total of N78.95bn was accrued to the government from the N50 levy imposed on electronic bank transfers.The Finance Act, of 2023 stipulates that revenue accruing by the operation of EMTL shall be distributed to the three tiers of government based on derivation with the federal government receiving 15 per cent; state governments receiving 50 per cent and the local governments receiving 35 per cent of the EMTL realised.
