A new bill has been proposed in Nigeria that aims to make it mandatory for individuals involved in banking, insurance, stock-broking, and other financial services to provide a Tax Identification Number (TIN) before opening a new account or operating an existing one. This move seeks to enhance tax compliance and increase revenue collection across all levels of government.
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,” the legislation was obtained from the National Assembly and dated October 4, 2024.
Under the proposed bill, individuals must present a valid TIN as a precondition to accessing services in the financial sector, including banking, insurance, and stock-broking. The bill also targets non-resident individuals who supply taxable goods or services or earn income from Nigeria, requiring them to register for tax purposes and obtain a TIN. However, non-residents earning only passive income from investments are exempt from registering but must provide necessary information to tax authorities.
Additionally, the bill grants tax authorities the power to automatically register individuals for a TIN if they fail to comply. Individuals will be notified upon registration and issued a tax ID.
Penalties for non-compliance are stipulated, including an initial fine of N50,000 for the first month of non-compliance and an additional N25,000 for every subsequent month of delay.
This legislation is part of Nigeria’s broader efforts to strengthen its tax administration and enhance revenue collection by ensuring that financial activities are closely linked with tax obligations.
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