Uche Usim, Abuja
Barely 24 hours after it mandated depositors to carry out fresh bank registration and record update, the Federal Inland Revenue Service on Friday made a U-turn on the directive, saying that the new development only applies to those paying taxes in more than one country.
The Service came under scathing criticism from the public on Thursday over its notice to banks, insurance companies and other financial institutions, where it directed customers to obtain, complete and submit Self – Certification Forms to their respective financial institutions.
By the notice, financial institutions were to begin the process of registering their customers to pave way for due diligence procedures in line with the Income Tax Regulations 2019.
The angry public flooded the social media to lampoon the FIRS, insisting that the directive was totally in conflict with the Bank Verification Number policy of the Central Bank of Nigeria.
They queried the rationale behind the government’s directive despite several biometric modes of identification in the country including the National Identity Card and the BVN.
They also said that the directive would increase the current burden on bank customers as many of them are still experiencing delays in carrying out bank transactions due to the physical distancing policy of the government to contain the spread of COVID-19.
Many also expressed fear that the new directive might provide an avenue for the banks to hammer the depositors with excessive charges as the cost of the registration would likely be transferred to them.
Sifting through the cyber attacks, the FIRS on Friday apologised for the earlier notice issued on Thursday.
It said, “We apologise for the misleading tweets (now deleted) that went up yesterday, regarding the completion of self-certification forms by Reportable Persons.
“The message contained in the @firsNigeria Notice does not apply to everybody. FIRS will issue appropriate clarification shortly.”
In the new notice that was issued after the apology, the service said
that the publication for financial institutions account holders in Nigeria to complete the self certification form, pursuant to the Income Tax (Common Reporting Standard) Regulations 2019 is for the fulfilment of Automatic Exchange of Information Requirements.
It said, “This is to clarify the publication for financial institutions account holders in Nigeria to complete the self-certification form, pursuant to the Income Tax (Common Reporting Standard) Regulations 2019 which is for the fulfilment of Automatic Exchange of Information Requirements.
“The Self Certification form is basically to be administered on Reportable persons holding accounts in Financial institutions that are regarded as ‘Reportable Financial Institutions’ under the CRS.
“Reportable persons are often non-residents. And other persons who have a residence for tax purposes in more than one jurisdiction or Country.
“Financial Institutions are expected to administer the Self Certification form on such account holders when the information at its disposal indicates that the Account holder is a person resident for tax purpose in more than one jurisdiction.
“The information that indicates an account holder is a resident for tax purposes in more than one jurisdiction, is expected to be available to Financial Institutions during the account opening processes for the KYC and AML purpose.”
The self-certification form, according to the FIRS is in three categories.
They are Form for Entity; Form for Controlling Person (Individuals having controlling interest in a legal person, trustee, etc) and Form for individuals.