• Banks notify customers of changes to EMTL

Electronic Money Transfer Levy (EMTL) revenue component of disbursements by the Federation Account Allocation Committee (FAAC) to the three tiers of government-Federal Government, states and local government councils amounted to N402.22 billion between January and November this year, findings by New Telegraph show.

The amount is 120.60 per cent, or N219.89 billion, higher than the N182.33 billion disbursed by the Committee to the three tiers of government as EMTL revenue in the corresponding period of 2024. An analysis of communiqués of the twelve FAAC meetings held this year indicates that the EMTL revenue disbursed to the three tiers of government amounted to N21.40 billion in January 2025; N35.17 billion in February; N26.01 billion in March, N40.48 billion in April, N28.82 billion in May, N30.38 billion in June, N39.17 billion in July, N33.69 billion in August, N53.84 billion in September, N49.87 billion in October and N43.40 billion in November.

Introduced by the Federal Government, via the Finance Act of 2020, as a way of generating more revenue by leveraging the accelerating growth in electronic funds transfer in the country, the EMTL is a singular and oneoff levy of N50 on the recipient of any electronic receipts or transfers of N10,000 and above. For equivalent receipts or transfers carried out in other currencies, the levy is charged at the exchange rates determined by the Central Bank of Nigeria (CBN).

The levy, which applies to all account types, came into effect in January 2021 and is an amendment of the Stamp Duty Act, under which, N50 used to be levied on electronic payments above N1,000. Under the Finance Act 2020, revenue derived from the EMT levy is shared based on derivation and distributed at 15 per cent to the Federal Government and Federal Capital Territory, 50 percent to the state governments and 35 per cent to the 774 local governments.

Thus, the recent press release issued by the Director, Information and Public Relations at the Federal Ministry of Finance, Mr. Mohammed Manga, at the end of the December 2025 meeting of the FAAC, stated that a total sum of N1.928 trillion was shared by the three tiers of government as Federation Allocation for the month of November 2025 from a gross total of N2.343 trillion.

According to the statement, “the sum of N43.400 billion from Electronic Money Transfer Levy (EMTL) was distributed to the three tiers of government as follows: the Federal Government received N5.947 billion, States got N19.823 billion, Local Government Councils received N13.876 billion, while N1.736 billion was allocated for Cost of Collection.”

The statement also said that the sum of N2.018 billion was given to transfers, refunds and savings. New Telegraph, however, reports that the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Mr. Taiwo Oyedele, announced, last month, that under the country’s 2025 Tax Reform Acts, state governments will, from 2026, retain 100 per cent of collections from the EMTL which, as from next month will be referred to as Stamp Duty. He also disclosed that the new tax reforms would significantly increase states’ allocations from the Value Added Tax (VAT) pool beginning next year, as one-third of what previously accrued to the federal government would now go to the states.

“From 2026, states will no longer share the Electronic Money Transfer Levy with the federal and local governments, it will belong entirely to them. In addition, state government bonds will be exempted from tax, helping to lower borrowing costs. There are also other measures to help states build capacity and close existing tax gaps.

“So, we have more reasons to be optimistic about sub-national governments, but perhaps even more reasons to demand better performance,” he said. Analysts note that under the New Tax Act (NTA), Stamp Duty, which has been expanded to include duties payable on chargeable instruments, including tax stamps, electronic tagging, electronic receipts and certificate issuance, will be debited from only the account of the sender of a transaction, rather than the current practice where the beneficiary’s account is also debited.

Indeed, in recent days, deposit money banks (DMBs) have been sending emails to their customers, notifying them of the impending change in the EMT levy. One of such emails sighted by New Telegraph’s correspondent partly read: ”Following the New Tax Act (NTA) 2025, please be informed that effective January 1, 2026, the N50 Electronic Money Transfer Levy (EMTL) will be referred to as Stamp Duty.

“This charge will be debited from the sender of the transaction, rather than the beneficiary.” According to official data, EMTL revenue generated by FIRS has maintained an upward trend since implementation of the levy commenced in 2021. Specifically, it stood at N114 billion in 2021, N125.67 billion in 2022, N181.21 billion in 2023 and N212.69 billion in 2024.