New Bill Proposes Mandatory Tax Identification Number for Financial Services in Nigeria

A new bill proposed in Nigeria aims to make it mandatory for individuals involved in banking, insurance, stock-broking, and other financial services to provide a Tax Identification Number (TIN) as a prerequisite for opening new accounts or operating existing ones. This legislative move is part of a broader effort to enhance tax compliance and improve revenue collection across the country.

The bill, titled “A Bill for an Act to Provide for the Assessment, Collection of, and Accounting for Revenue Accruing to the Federation, Federal, States, and Local Governments; Prescribe the Powers and Functions of Tax Authorities, and for Related Matters,” outlines measures designed to strengthen Nigeria’s tax system. Dated October 4, 2024, and obtained from the National Assembly, the bill explicitly states, “A person engaged in banking, insurance, stock-broking, or other financial services in Nigeria shall make the provision of a tax ID, a precondition for opening a new account or operating an existing account.”

The proposed legislation reflects Nigeria’s ongoing efforts to ensure that all individuals and entities participating in financial activities are properly registered for tax purposes. By making a TIN a mandatory requirement, the government aims to widen the tax net and reduce tax evasion. This measure is expected to streamline the identification of taxpayers and improve the country’s revenue collection process, ultimately contributing to the nation’s economic growth.

The bill is also intended to empower tax authorities with more oversight and enforcement capabilities, ensuring that both federal and state tax authorities can monitor and verify financial activities more effectively. This aligns with the government’s broader agenda to boost fiscal responsibility and accountability across all levels of financial operations.

While the bill is still under consideration, its implementation could significantly impact individuals and businesses in the financial sector. As authorities work towards securing passage and implementation of the legislation, stakeholders in the financial industry and the general public will need to prepare for the new requirements, which could soon become a fundamental part of financial operations in Nigeria.