The Federal Government of Nigeria has projected to generate N136.3 billion as revenue from Electronic Money Transfers (ETM) to be paid by bank customers in 2023. This is based on a projected 2.7 billion volume of eligible online transfers in the year.
What is Electronic Money Transfer?
This is a levy that is charged on an electronic transfer at the time of the transfer. The Levy applies to the following transfers: Mobile money transfers done between accounts on the same electronic money issuer.
The Budget Office of the Federation, which revealed this in its latest 2023-2025 Medium Term Expenditure Framework and Fiscal Strategy paper, said the recently approved regulations governing the administration of the Electronic Money Transfer Levy (EMTL) is expected to boost collections of the revenue. The government also said it would ensure proper monitoring of banks and other financial institutions to conduct reconciliation and to ensure deduction and remittance of the levy.
Here are some important key notes you should know about the EMT levy since its inception;
The EMT levy was introduced in the Finance Act 2020, which amended the Stamp Duty Act and taps into the growth in electronic funds transfer in Nigeria.
This levy implied that N50 levy is charged on electronic transfer of money deposited in any bank or financial institution, on any account, on the sum of N10,000.00 or more.
The revenue derived from the EMT levy is shared based on derivation and distributed at 15% to the Federal Government and Federal Capital Territory, while 50% goes to the state governments, and 35% to the 774 local governments.
It might interest you to note that the revenue projection from the EMTL for next year is, however, lower than the current year’s target of N209.7 billion as set in the amended 2022 framework. In 2021, the government had projected N500 billion revenue from the levy but realized only N111.84 billion at the end of the year. This means the government has been short of meeting its target over the last one year, leaving the question hanging of its ability to meet its 2023 newly set target.