The Nigerian Senate has proposed a sharing formula for the Windfall Levy on foreign exchange transactions by banks, allocating 70% to the Federal Government and 30% to the banks.
The levy, set to take effect in January 2024, aims to generate revenue from the bank’s foreign exchange transactions to finance the N6.2 trillion in the amended 2024 budget.
This follows the adoption of the report of Senate Joint Committee on Finance which also recommends a 10% penalty on defaulters who fail to remit government’s share of the Windfall Profit levy into the Federation Account.
President Bola Tinubu last week requested the National Assembly to amend the Finance Act, proposing a 50% Windfall Profit levy on banks foreign exchange transactions.
However, lawmakers increased the Federal Government’s share to 70%, altering the initial 50-50 sharing formula.
Minister of Finance, Wale Edun who was in the National Assembly to defend the
Windfall Profit levy, said it is aimed at redistributing surplus gains earned by banks as a result of change in government foreign exchange policy.
Governor of the Central Bank of Nigeria, Yemi Cardoso who was represented at the stakeholders meeting on Tuesday supported the Windfall Profit levy, confirming that its earlier circular in March asking banks not to tamper with the windfall profits subsists.
The Senate will have to reconcile its versions of the amended 2024 budget and Finance Act with those of the House of Representatives that also passed the two amendment bills on Tuesday.
(Editor: Terverr Tyav)
