### Clarification on VAT Charges by Nigeria Revenue Service: A Response to Misinformation The Nigeria Revenue Service (NRS) has recently addressed widespread confusion regarding the application of Value-Added Tax (VAT) on banking services. Reports circulating in the media suggested that VAT was newly imposed on banking transactions, including electronic money transfers. The NRS has clarified that this is not the case, emphasizing that VAT applies only to service charges levied by banks, not to the funds transferred by customers. This clarification aims to dispel misinformation and reassure the public about existing tax regulations. ### Breakdown of the NRS Clarification 1. **Nature of VAT Application**: - The NRS confirmed that VAT is applicable solely to service charges collected by banks, which includes fees for transactions and commissions, rather than on the actual money transferred between accounts [https://gongnews.net/vat-applies-only-to-bank-service-charges-not-transfers-nrs]. 2. **Response to Misinformation**: - The agency has labeled recent claims about new VAT charges as "incorrect and misleading," asserting that there have been no changes to the existing tax framework regarding banking services [https://dailypost.ng/2026/01/15/vat-tax-on-banking-services-not-new-nigeria-revenue-service]. 3. **Public Communication**: - NRS officials, including Dr. Zacch Adedeji, have actively communicated through various media channels to clarify the situation, aiming to alleviate public concerns and confusion [https://therevealerng.com/nrs-clarifies-vat-charges-collected-by-banks-on-customer-transactions]. 4. **Historical Context**: - The NRS emphasized that the VAT on banking services is not a new development and has been part of the tax structure for some time, countering claims that recent legislation introduced these charges [https://newtelegraphng.com/vat-on-banking-charges-not-new-nrs-clarifies]. ### Supporting Evidence and Data - **VAT Rate**: The VAT rate applicable to banking service charges is set at **7.5%** [https://alltimepost.com/2026/01/vat-applies-only-to-bank-service-charges-not-transferred-funds-nrs-clarifies]. - **Official Statements**: Multiple statements from the NRS have reiterated the same message, ensuring consistency in communication across various platforms [https://globalfinancialdigest.com/nrs-clarifies-vat-not-newly-imposed-on-banking-services]. ### Conclusion: Key Takeaways from the NRS Clarification 1. **No New VAT Charges**: The NRS has confirmed that there are no new VAT charges on banking services, including electronic transfers [https://dmarketforces.com/no-new-vat-charges-on-bank-services-nrs-says]. 2. **VAT Applies to Service Fees Only**: The 7.5% VAT is applicable only to the service fees charged by banks, not on the transferred funds themselves [https://naijaonpoint.com.ng/nrs-clears-air-on-vat-says-bank-transfers-not-taxed]. 3. **Public Assurance**: The NRS aims to reassure the public that existing tax regulations remain unchanged and that misinformation will be actively addressed [https://insidebusiness.ng/237820/nrs-oyedele-clarifies-vat-on-bank-fees]. In summary, the NRS has taken proactive steps to clarify the application of VAT on banking services, ensuring that the public is accurately informed and reducing the potential for confusion regarding tax obligations.