Listed Banks Pay N131bn into Government’s Coffers as Tax

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Goddy Egene

Thirteen banks listed on the Nigerian Stock Exchange (NSE) have contributed a total of N131.189 billion to the coffers of the federal government as income tax for the financial year ended December 31, 2016.

Apart from the FBN Holdings Plc and Skye Bank Plc, that are yet to report their 2016 audited results, other banks had submitted their results. And THISDAY analysis of the results showed that the banks paid government about N131.189 billion as income tax from the profit they posted for the year. The amount is 53 per cent above the N85.464 billion they paid in 2015.

The banks are: Access Bank, Diamond Bank, Guaranty Trust Bank Plc, Ecobank Transnational Incorporated, FCMB Group Plc, Fidelity Bank Plc, Stanbic IBTC Holdings Plc, Sterling Bank Plc, Union Bank of Nigeria Plc, United Bank for Africa Plc, Unity Bank Plc, Wema Bank Plc and Zenith Bank Plc.

A breakdown of the tax payment showed that GTBank Plc paid the highest of N32.8 billion, followed by Zenith Bank Plc with N27 billion, while Access Bank Plc contributed N18.9 billion to government’s coffers. UBA paid N18.328 billion just as ETI paid N18.2 billion. Stanbic IBTC Holdings paid N8.689 billion while Unity Bank Plc, Fidelity Bank Plc and Diamond Bank Plc contributed N1.816 billion, N1.327 billion, and N1.287 billion respectively.

Others are: FCMB Holdings (N924 million), Sterling Bank Plc (N837 million), Wema Bank (N684 million), and Union Bank (N347 million). Market analysts said as the government continues to find ways of taking the economy out of recession, the banks would performance better and increase their contributions as tax.

As revenue from oil suffers a decline due to low prices, it is believe government should focus on revenue from taxes and the encouraging companies to list on the NSE is one of the best ways to ensure payment of taxes by companies.

According to the Executive Director, Capital Market Division, NSE, Mr. Haruna Jalo-Waziri, “it is evident that listed companies on the NSE pay more corporate tax to the federal government due to their high level of transparency, financial disclosure and corporate governance.”

Jalo-Waziri therefore, called on the government to put in place enabling laws and framework to enable more listings on the NSE, develop friendly tax policies and codes for listed companies, as well as encourage tax holidays while making it more difficult and expensive for tax avoidance.

Speaking in the same vein, Mr. Ayodeji Ebo of Afrinvest West Africa, said fresh listings on the stock market, especially for small and medium firms, are capable of boosting government revenue accruable from taxes following the requirements for improved disclosure from the NSE, SEC and other stakeholders.
“The deepening of the market, by implication, will drive more businesses and indirectly generate tax revenue for government at the close of deals,” he said.

The General Manager, Operations, Central Securities Clearing System Plc, Joe Mekiliuwa, said new listings on the NSE will help the federal government to generate more tax returns.
He said: “Part of the transparency in the marketplace is that it is rule-driven, and being listed makes it possible for the government to have visibility in the operations of the company, as well as the general public. Listing enables the government to assess possible tax returns and monitor same.”