ADVERTISEMENT
The Sun Nigeria
  • Home
  • National
  • Columns
    • Broken Tongues
    • Capital Matters
    • Diabetes Corner
    • Duro Onabule
    • Femi Adesina
    • Frank Talk
    • Funke Egbemode
    • Insights
    • Kalu Leadership Series
    • Kunle Solaja
    • Offside Musings
    • PressClips
    • Public Sphere
    • Ralph Egbu
    • Shola Oshunkeye
    • Sideview
    • The Flipside – Eric Osagie
    • Tola Adeniyi
  • Business
  • Politics
  • Entertainment
  • The Sun TV
  • Sporting Sun
No Result
View All Result
  • Home
  • National
  • Columns
    • Broken Tongues
    • Capital Matters
    • Diabetes Corner
    • Duro Onabule
    • Femi Adesina
    • Frank Talk
    • Funke Egbemode
    • Insights
    • Kalu Leadership Series
    • Kunle Solaja
    • Offside Musings
    • PressClips
    • Public Sphere
    • Ralph Egbu
    • Shola Oshunkeye
    • Sideview
    • The Flipside – Eric Osagie
    • Tola Adeniyi
  • Business
  • Politics
  • Entertainment
  • The Sun TV
  • Sporting Sun
No Result
View All Result
The Sun Nigeria
No Result
View All Result
ADVERTISEMENT
Home Business

Unclaimed Dividends: Govt’s proposed takeover unfair, will adversely affect the capital market – Expert

Urges govt to make procedure less cumbersome for beneficiaries

9th December 2020
in Business, National
0
Unclaimed Dividends: Govt's proposed takeover unfair, will adversely affect the capital market- expert
0
SHARES
182
VIEWS
Share on FacebookShare on Twitter

By Henry Uche, Lagos

As mixed reactions trail the Finance Bill 2020 forwarded to the National Assembly for consideration and passage by the President, particularly in section 39, the President/Chairman of Council, Institute of Chartered Secretaries and Administrators of Nigeria (ICSAN), Bode Ayeku, has maintained that government’s proposed takeover of unclaimed dividends of around N200 billion belonging to shareholders is uncalled-for and the proposal should be jettisoned.

Speaking in an interview with Channels TV (Capital market news hour) over the weekend, Ayeku urged the government to instead make the processes and steps involved to access the dividends to be seamless for beneficiaries.

Are you a Man 40 yrs and above? Do not miss the Vital Information, it goes off in 2 days! CLICH HERE to READ .

According to him, the proposal will not only affect the capital market adversely, but the poverty level of the shareholders in the country would skyrocket when listed companies delist from the Nigerian Stock Exchange (NSE) to avoid the problems that the proposal would create for them.

He noted that the companies would just re-register as private companies and the dividends that are currently shared by larger number of shareholders would now be shared by just 50 shareholders. This would deprive majority of the shareholders from sharing in the dividends declared by these companies in future and block their major source of regular income, particularly, for the retirees who are not paid their monthly stipends regularly.

He noted that delisting by these companies, following recent practice by some big companies, would further reduce the number of shares available for trading; loss of revenue on shares traded on the Floor of the NSE by the government (stamp duty and VAT); loss of commission by Securities & Exchange Commission (SEC), NSE and Central Securities Clearing System (CSCS) on every trade and brokerage due to the brokers. He noted that these listed companies have alternative sources of raising funds and listing on NSE have cost implications and do not confer any advantage on them of increasing their turnover or grant any incentives or tax rebates.

ICSAN president noted that the federal government has no right to claim dividends of private persons which are private funds under section 44 of the 1999 Constitution. He recommended that the federal government should work with the state governments to simplify the current complex, exploitative and unfair probate system which requires the payment of 10% Estate duty on both the balance in the bank account of the deceased notwithstanding that government has collected tax on the money. He observed that the dependance are also required to pay additional 10% on the value of the shares of the deceased despite the fact that they have no intention to sell these shares, but only to obtain probate or letters of administration (just technically change of ownership). In the process, several dependance are forced to abandon the dividends, since in some cases, the amount to be paid to the government to get the probate (which they cannot afford) to collect the unclaimed dividends is more than the value of the unclaimed dividends. He advised that SEC should further simplify the e- dividend payment system to allow one form to be used by a shareholder to claim all unclaimed dividends in all companies instead of filling one form for each company.

He recommended that every current and future shareholder should be required to nominate a default beneficiary into whose account the dividend would be paid in case of death or problem with the bank account of the shareholder.

Premature Ejaculation & "Small Joystick" Resolved in 7Days... Click Here For Details .

‘Government should remove all the bottleneck involved in claiming dividend. For instance, the total amount to be paid to the government to obtain letters of administration / probate should be five thousand (N5,000) maximum and there must be a timeline for issuing letters of administration / probate after submitting all documents by the dependance.

‘We found it extremely strange for government to take over any unclaimed dividends after 12 years. These dividends belong to the shareholders who have invested in these companies. The government has no investment in these companies through purchase of their shares and so, the government has no right to claim what does not belong to it. Hence this move is an infringement of section 44 of 1999 Constitution of Nigeria which guarantees the right to property to every person. In addition, principle 23 of the Nigerian Code of Corporate Governance 2018 deals with the protection of shareholders’ right which this proposed takeover would affect.

100% Natural Herbs to Finally End Premature Ejaculation, Weak Erection and Small Manhood. >>>Click Here for Details<<< .

‘Government proposal in this matter is strange because these companies that declared dividends have already paid the government 42% of the profit as taxes: 30% corporate tax, 2% education tax and 10% as withholding tax. It is not fair to the shareholders for the government to now propose to takeover the remaining 58%.

‘Government should not think that unclaimed dividends have no owners. The dividends belong to the people (or their dependance/beneficiaries), these beneficiaries should be traced and invited to claim these dividends,’ he advised.

He noted that most shareholders are extremely poor and deserve palliatives from the government and not otherwise. Therefore, the federal government in conjunction with the state governments must draw the attention of the High Court Probate Registry in every state to remove the 10 % Estate duty on the cash and physical assets of the deceased and make the whole process less difficult for beneficiaries of deceased shareholders to get the probate and claim the dividends.

Meanwhile, the head, Research, at United Capital, Wale Olusi, who spoke at the same platform on CNB Special Bill Issuances(impact on Capital market) said aside an additional outlet for fund, the special bill has no significant impact in market though it would improve the liquidity of the banks. He noted, “We don’t expect much change for the stock, but let’s see what happens within the benchmark, if the government will keep their words,”

He added that the recent launch of sukku fund by United Capital is an opportunity for investors to access other options and earn bigger, noting that even the government can take advantage of it to fund infrastructure.

Olusi said: ‘The United Capital Sukuk Fund is an open-ended mutual fund that will be invested in Naira denominated Sharia-Compliant securities and investments products, floated by the Federal Government of Nigeria (“FGN”), and other qualifying Corporate entities whose securities are approved by the Commission and permissible under Sharia principles, in varying proportions.

‘It is aimed to provide investors with a low-risk investment with stable and competitive returns through investments in short, medium and long-term Sharia-Compliant securities and investment products, whilst ensuring the preservation of capital and maintaining a reasonable degree of liquidity.’

According to him, It was designed to provide its Unitholders with halal profits on the growth of their capital over the long-term in accordance with the principles of Islamic finance. It aims to provide its Unitholders with halal profits on the growth of their capital over the long-term in accordance with the principles of Islamic finance.

Tags: bode ayekuCSCSdividendsfinance bill 2020ICSANnigerian stock exchangeNSETAXVAT
David

David

Sun News Online team

Related Posts

Northern elders reject special treatment, trial for Kanu
National

Kanu loses bail bid as FG withdraws newly amended charges

19th May 2022
Withdrawal from elections: Buhari to decide Malami, Sylva, Ngige, others’ fate
Cover

Withdrawal from elections: Buhari to decide Malami, Sylva, Ngige, others’ fate

19th May 2022
Okada rider rapes pregnant woman in Ondo, steals her belongings
National

Many feared dead as traders, okada riders clash in Abuja

19th May 2022
Next Post
FCT Administration to roll out BRT

FCT Administration to roll out BRT

Delta governor orders police to hunt down killers of anti-cult chief

Delta governor orders police to hunt down killers of anti-cult chief

Ohanaeze slams Northern Elders over violence allegation

Ohanaeze slams Northern Elders over violence allegation

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

ADVERTISEMENT

Highlights

Deborah as symbol of retrogression

Jonathan, Emefiele: Two of a strange species

Deborah Samuel and the college idea

Kanu loses bail bid as FG withdraws newly amended charges

Gunshots rock Rivers APC secretariat over screening

El-Rufai’s campaign for power shift to South

Trending

2023: Atiku begins consultations
Politics

Atiku wants PDP presidential aspirants to work for party’s success

19th May 2022
0

From Olanrewaju Lawal, Birnin Kebbi Former vice president and PDP presidential aspirant, Alhaji Atiku Abubakar, has urged...

Atiku wants PDP presidential aspirants to work for party’s  success

Emmanuel visits Gombe, Bayelsa, pledges good governance, economic revival

19th May 2022
How to stabilise Nigeria –Olawepo-Hashim

Deserving APC candidate must commit to formation of govt of national unity – Olawepo-Hashim

19th May 2022
Republic of rituals?

Deborah as symbol of retrogression

19th May 2022
The wolfs in our midst

Jonathan, Emefiele: Two of a strange species

19th May 2022

Follow us on social media:

Latest News

  • Atiku wants PDP presidential aspirants to work for party’s success
  • Emmanuel visits Gombe, Bayelsa, pledges good governance, economic revival
  • Deserving APC candidate must commit to formation of govt of national unity – Olawepo-Hashim
  • Deborah as symbol of retrogression
  • Jonathan, Emefiele: Two of a strange species
  • Deborah Samuel and the college idea
  • Kanu loses bail bid as FG withdraws newly amended charges
  • Gunshots rock Rivers APC secretariat over screening
  • El-Rufai’s campaign for power shift to South
  • Taraba’s ancient, mysterious tradition resurfaces as Aku Uka transits to Nando
  • Good Shepherd celebrates golden jubilee in style
  • Philanthropist rebuilds 83-year-old customary court in Abam community
  • Monkey pox: Unwanted guest that must be tackled
  • Nigeria gets second Noma treatment centre
  • Malaria: Prevention better than treatment –Reckitt
  • Finidi: I didn’t expect Super Eagles job
  • Okpekpe 10km road race gets MTN boost
  • Wife, children, friends to celebrate Ogbeide’s anniversary
  • Women Football Stakeholders applaud Tulcan Energy Resources for Super Six sponsorship
  • Kienka faults Nigeria’s basketball withdrawal

Categories

  • Abuja Metro
  • Anambra Watch
  • Arts
  • Broken Tongues
  • Business
  • Business Week
  • Cartoons
  • Citizen Joe
  • Columns
  • Cover
  • Culture
  • Duro Onabule
  • Editorial
  • Education Review
  • Effect
  • Elections
  • Entertainment
  • Events
  • Features
  • Femi Adesina
  • Food & Drinks
  • Frank Talk
  • Funke Egbemode
  • Gallery
  • Global Square by Kenneth Okonkwo
  • Health
  • Insights
  • Kalu Leadership Series
  • Kunle Solaja
  • Kunle Solaja
  • Letters
  • Lifeline
  • Lifestyle
  • Literary Review
  • Marketing Matters
  • Muiz Banire
  • National
  • News
  • Offside Musings
  • Opinion
  • oriental news
  • Politics
  • Press Release
  • PressClips
  • Public Sphere
  • Ralph Egbu
  • Shola Oshunkeye
  • Sideview
  • South-west Magazine
  • Sponsored Post
  • Sporting Sun
  • Sports
  • Sun Girl
  • Tea Time
  • The Flipside – Eric Osagie
  • The Sun Awards Live
  • The Sun TV
  • Thoughts & Talks
  • Time Out
  • Today's cover
  • Tola Adeniyi
  • Travel
  • Travel & Tourism
  • Trending
  • TSWeekend
  • Turf Game
  • Uncategorized
  • Updates
  • Views from Abroad
  • Voices
  • World
  • World News
  • Home
  • About Us
  • Paper Ad Rate
  • Online Ad Rate
  • The Team
  • Contact Us
  • Privacy Policy

© 2019 The Sun Nigeria - Managed by Netsera.

No Result
View All Result
  • Home
  • National
  • Columns
    • Broken Tongues
    • Capital Matters
    • Diabetes Corner
    • Duro Onabule
    • Femi Adesina
    • Frank Talk
    • Funke Egbemode
    • Insights
    • Kalu Leadership Series
    • Kunle Solaja
    • Offside Musings
    • PressClips
    • Public Sphere
    • Ralph Egbu
    • Shola Oshunkeye
    • Sideview
    • The Flipside – Eric Osagie
    • Tola Adeniyi
  • Business
  • Politics
  • Entertainment
  • The Sun TV
  • Sporting Sun

© 2019 The Sun Nigeria - Managed by Netsera.

Posting....