Naira rises against dollar in all markets as FG introduces new charges in dollar accounts

The Nigerian currency continued to rally against the US dollar after opening the week on a positive note on Monday, December 18, 2023.

Despite massive pressure on forex transactions this Christmas season, the Naira recovered marginally against the dollar.

Naira begins week on a positive note

The Naira appreciated by 0.17% to close at N888.35 per dollar, according to data from the Nigerian Autonomous Foreign Exchange Market (NAFEM).

The recovery represents an N1.51 gain against the dollar compared to the N889.86 it closed on Friday, December 15, 2023.

The intraday transaction at NAFEM recorded a high of N1,249 to a dollar, while the intraday low was N529 to a dollar.

Data from NAFEM shows that forex turnover stood at $137.82 million, representing a 230.82% rise compared to the previous trading day.

Also, the Naira gained marginally at the parallel market, trading at N1,235 to a dollar, a 0.81% gain compared to the previous day.

FIRS sends important message to banks on charges on FX transactions

The development comes as the Federal Inland Revenue Service (FIRS) has asked commercial banks to remit Electronic Money Transfer Levy (EMTL) on foreign currency transactions in the future, a Legit.ng report said.

The levy aligns with the 2020 Finance and Stamp Duty Act 2004, which imposes EMTL on transfers for money deposited in any financial institution on any account.

Reports say financial institutions have begun complying with the directive and have informed their customers of the new development.

The notice of remittance of EMTL, sent to customers by one of the central banks, told them of the deduction of N50 on every foreign currency transaction with an equivalent of N10,000 and above going forward.

The notice added that the amounts deducted would be remitted to the relevant tax bodies.

It further stated that it would deduct EMTL on eligible transactions done from the first week of January 2o21, to the last week of December 2023.

The levy provides additional revenue for the Nigerian government and is deducted from other economic activities, including energy.

CBN issues guidelines on FX charges

According to a ThisDay report, the Chairman of the Revenue Mobilisation and Fiscal Commission (RMAFC), Mohammed Bello Shehu, said that about N83.02 billion accounted for revenues from electronic money transfer levy, out of which N3.32 billion was remitted to the FIRS as collection cost between January and June 2023.

In August 2021, the Central Bank of Nigeria (CBN) disclosed operational guidelines and regulations for in-country clearing settlement of foreign currency fund transfers among Nigerian banks.

The Apex bank said the move is to enable faster, cheaper, more transparent, and safer operation of foreign currency transfers among banks, improving the efficiency and confidence in in-country foreign currency transfers.