The federal government has introduced a new bill that could significantly transform Nigeria’s financial services sector. If passed, this legislation will require all individuals involved in banking, insurance, and stockbroking to provide a Tax Identification Number (TIN) as a mandatory prerequisite for opening new accounts or operating existing ones.
The bill, submitted to the National Assembly on October 4, aims to enhance tax compliance and streamline revenue collection across the country. Officially 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,” it reflects the government’s push toward improved fiscal oversight.
According to the document, “Any person engaged in banking, insurance, stockbroking, or other financial services in Nigeria shall provide a tax ID as a condition for opening a new account or operating an existing one.”
The bill also addresses non-residents conducting business in Nigeria. It mandates that non-residents supplying taxable goods or services or earning income from the country must register for tax purposes and obtain a TIN. However, individuals who derive only passive income from investments, such as dividends or interest, are exempt from this requirement. Instead, they will be required to provide relevant financial information to the appropriate tax authority.
The legislation grants tax authorities the power to automatically register and issue tax IDs to individuals who are required to apply but fail to do so. In such cases, the tax authority will notify the individual of their registration and provide the issued tax ID.
Non-compliance with the bill’s provisions may attract penalties. Specifically, individuals who fail to register for taxes will be fined ₦50,000 for the first month of non-compliance and ₦25,000 for every subsequent month of default.
This proposed bill highlights the government’s efforts to ensure better compliance with tax laws and secure more robust revenue streams to support development.
