The federal government has told all ministries, departments, and agencies to quit deducting the one percent stamp duty from payments made to suppliers, contractors, providers, and merchants right away.
Issued by the Office of the Accountant General of the Federation, the directive aims to bring government procedures in line with the terms of the Nigeria Tax Act 2025 following its enactment.
The News Chronicle reports that the government made it clear that stamp duty is only relevant for particular instruments and documents specifically mentioned under the tax legislation, not for payment transactions. Consequently, MDAs have been told to stop deducting regular payments and make sure the updated framework is completely followed.
The circular said that deductions taken before the start of the new legislation are still legitimate under current savings clauses. Furthermore, it clarified that agreements signed before January 1, 2026, will still follow the earlier stamp duty regulations.
Under the new tax system, agreements worth up to N1 million qualify for a flat stamp duty of N1,000; transfers with mineral assets, oil and gas rights, and mining licenses are subject to different fees. The change should help companies interacting with government agencies to have more clarity and help to stop improper deductions.
