SEC, CSCS, NSE, operators to pay VAT


January 11, 2007/ BusinessDay




<P>The Securities and Exchange Commission, the Nigerian Stock Exchange, the Central Securities and Clearing System (CSCS ) and stock brokers are to pay value added tax on their income, to the Federal Inland Revenue Service (FRIS) has said.</P>


<P>Stock brokers are to pay the tax on their commission.</P>
<P>According to new statutory fees and guidelines for buying and selling of stocks on the exchange..The the new rule which became effective Thursday ,January 4,2007, the CSCS will pay 5 percent fees will be paid as VAT or 0.005 consideration. For selling, the NSE is also to pay 5 per cent VAT or 0.005 consideration on fees collected.</P>


<P>During, the review of the performance of The Nigerian Stock Exchange in 2006. The Director General of NSE, Ndi Okereke Onyuike complained about the new fees imposed. She said \"The FIRS should try and understand that this kind of taxation will chase away investors from the market\". She said if the FIRS continue with this policy, a lot of stockbrokers will be unable to cope, and she also warned that companies might be forced to practice tax evasion.</P>


<P>Meanwhile others fees remained unchanged. For buying, stamp duty remains at 0.075 per cent consideration. VAT on brokers commission remains 5 per cent of the broker’s commission. Securities and Exchange Commission (SEC) fees remains at 1 per cent of consideration. While, for the CSCS fees remained at 0.1 per cent of consideration. In all, the total consideration is 1.3175 per cent. This was against the total of 1.3125 per cent consideration used before.</P>


<P>For selling, stamp duty remained at 0.075 per cent consideration. VAT on brokers commission remained at 5 per cent or 0.1375 per cent consideration. VAT on CSCS fees remained at 0.45 per cent consideration. <I><SPAN style=\"FONT-SIZE: 10pt; COLOR: #dcdcdc\">- BusinessDay</SPAN></I></P>

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