Court Declares NIPOST N50 Stamp Duty Illegal

April 16, 2017

By Modupe Gbadeyanka

Justice Gabriel Kolawole of the Federal High Court sitting in Abuja has declared the collection of N50 stamp duty by the Nigerian Postal Services (NIPOST) as illegal.

The judge therefore directed the agency to desist from further collecting the money.

“The NIPOST as a defendant in this suit acted unlawfully, illegally and ultra-vire by unilaterally increasing the 2kobo stamp to N50 without any back up law and under the guise that 2kobo stamps are no longer in circulation in Nigeria.

“Under section 89 of this Act, the NIPOST has no power to compel the plaintiff (NBC) to affix N50 stamp on its receipts and other documents.

“By this, NIPOST has no business or authority in sending Kasmal International Services on illegal errand to compel the plaintiff on the N50 stamp duty tax,” Justice Kolawole declared in his judgement.

NIPOST was dragged to court by the Nigerian Bottling Company (NBC) alongside a private firm, Kasmal International Services.

The court held that there was nowhere in the Stamp Duties Act 2004 NIPOST was empowered by the law to impose stamp duty tax on the bottling company, banks and other establishments.

Though the Act recommended 2kobo stamp to be affixed on certain categories of documents, NIPOST, lacked the power to arbitrarily increase the amount to N50 without firstly securing an amendment of the Act through the National Assembly, the court held.

“A law is a law and has to be obeyed or implemented as it is. Section 89 of the Stamp Duties Act which recommended the use of adhesive 2kobo stamp on certain categories of receipts and document is the law in force,” the judge said.

“The extant law is for 2kobo stamp. No law has amended the Stamp Duties Act 2004 to increase it to N50.

“At any rate, NIPOST is not a tax collecting establishment and as such, cannot exercise any power not expressly donated to it by law,” Justice Kolawole added.

Consequently, the court issued an order of injunction against the NIPOST and Kasmal International Services, stopping them from further harassing, embarrassing, intimidating, coercing or disrupting the business operation of the plaintiff in the name of unlawful stamp duty tax until the extant laws are reviewed.

Recall that the President Muhammadu Buhari led administration had expressed its determination to generate over N5 trillion from stamp duty tax.

Modupe Gbadeyanka

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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