This was announced by the Federal Government in a social media statement on Thursday. The FG warned that failure to comply may include a monetary penalty or inability to operate the account.
It stated, “This is to notify the general public that all account holders in Financial Institutions (Banks, Insurance Companies, etc) are required to obtain, complete and submit Self – Certification Forms to their respective Financial Institutions. Persons holding accounts in different financial institutions are required to complete & submit the form to each one of the institutions. The forms are required by the relevant financial institutions to carry out due diligence procedures in line with the Income Tax Regulations 2019.”
According to the government, the certification forms would be in 3 categories, which are “Form for Entity – For Controlling Person (Individuals having controlling interest in a legal person, trustee, etc) – Form for individual”.
Comply or face sanctions: The Government urged Nigerians to comply with the requirements and execute all forms needs, if not sanctions may be introduced in the forms of monetary penalty or inability to operate the account.
- The government did not explain what those sanctions will be and how it will be implemented.
- The inability to operate the account suggests the government could end up freezing the bank account of Nigerians
What this means: It appears this is part of the government’s efforts to widen the tax base as it steps up its strategy of relying on taxes to increase its revenue. Government revenue has been hard hit by the drop in oil prices and the Covid-19 Pandemic affecting its ability to pay for development programs, meet overheads and offer palliatives to Nigerians who are reeling from economic crunch.
The government has over the years introduced several measures targeted at increasing tax revenues. For example…
- Last year, the FIRS launched a new universal TIN aimed to boost tax compliance and revenue collection in the country.
- Former FIRS Boss, Fowler, stated then that “the new system is able to generate TIN automatically for newly registered cooperate taxpayers from CAC, verify TIN details and print TIN certificate, using the TIN Verification Portal.
- And that “The system also allows tax officials and taxpayers to initiate TIN registration from the comfort of their homes/offices and at their convenience, as the system also notifies the taxpayer through a robust and secured system-system integration, with transparent and convenient benefits.”