Published by The Tax Club, University of Lagos. on

By Fawaz Haroun.


The Federal Inland Revenue Service (FIRS) recently released a circular on the amendment of the Stamp Duties Act pursuant to the Finance Act 2019. The Circular is in line with the desire of the federal government to align its tax laws with the global standard and increase its revenue gotten from taxation. As the subject of the Circular states, the Circular is to provide clarifications on the Stamp Duties Act, especially in light of the amendments which have been made to the Act by the Finance Act 2019. The Circular restates some amendments which have already been stated in the Finance Act, while going further to provide for more clarifications.

The Finance Act 2019 provides for both physical documents and electronic documents to be subject to stamp duties. While Section 2 of the Stamp Duties Act only provided for stamp duties on physical documents, the Finance Act extended the application of Stamp Duties to electronic documents in light of modern developments. The Circular re-echoes this. Therefore, “electronic stamping” and “electronic denoting” are now permissible under the law. 

According to the Circular, stamp duties may be denoted by:

  1. Employing a die impressed on an instrument as an adhesive stamp;
  2. Affixing printed adhesive stamps (issued by the Service) on instruments;

iii. Direct electronic printing or impression on the instrument;

  1. Electronic tagging;
  2. Issuance of stamp duties certificate.
  3. Any other form of acknowledgement of payment for stamp duties adopted by the Service.

It is important to note the effect of stamp duties now applying to electronic documents. Agreements drafted and signed online, email correspondences, SMS acknowledgements and even WhatsApp messenger messages shall be enough. If one party sends a message via WhatsApp to another party in acknowledgment of receipt of a sum, it shall qualify as an electronic document upon which stamp duties should be paid. Individuals are required to self-declare such and the details of the transaction either through the FIRS e-stamp duties platform or to the relevant stamp duties Commissioner.

Also noteworthy is the requirement to pay stamp duties on electronic documents executed outside Nigeria once such documents are received in Nigeria. An electronic document, instrument or receipt also falls under this category if it is: i. retrieved or accessed in or from Nigeria, ii. stored on a device and brought into Nigeria, or iii. stored on a device or computer in Nigeria. Merely viewing the electronic version through WhatsApp messenger, an e-mail, or downloading such from a server shall be enough to make it subject to stamp duties. Such instances must be presented for stamping within 10 – 30 days depending on the type of transaction.

The Circular also expressly spells out the authority in charge of collecting stamp duties. The Federal Inland Revenue Service is the competent authority to charge and collect duties upon instruments relating to transactions or matters executed between corporate bodies or between a corporate body and an individual, group or body of individuals. The relevant state tax authority shall collect duties in respect of instruments executed between individuals at such rate to be imposed or charged in agreement with the Federal Government.

The Circular also makes reference section 89 of the Stamp Duties Act which requires banks to charge 50 naira stamp duties on all deposits and transfers up to 10,000 naira except it is a transfer between two accounts maintained by one person in the same bank.

Compliance with the law is largely based on individuals, especially in relation to electronic documents. It shall likely be difficult to keep track of documents which are received electronically except in situations where the individuals involved declare such. There is also the need to more properly enlighten the general public, as individuals shall be unable to comply when they are ignorant of such requirements. The Circular also provides for a range of punishments for non-compliance ranging from prosecution and penalty payments to inability to use such documents as evidence in a court of law or before other quasi-judicial bodies.


Fawaz Haroun.

Fawaz Haroun is a 400 level student of the faculty of law, University of Lagos. He is the Online Managing Editor of the UNILAG Law Review and a member of The Tax Club research team. His interest lies in maritime law, taxation law, public international law and technology law. He has written multiple articles spanning these interests and beyond. He was also a member of the UNILAG team at the Philip C. Jessup Moot competition 2020, where his team won the National rounds.

Categories: National Tax

The Tax Club, University of Lagos.

The official website of the Tax Club, University of Lagos.

Leave a Reply

Your email address will not be published. Required fields are marked *