Reps order GTB to remit VAT on Remita commissions from 2015-2022

The House of Representatives has instructed Guaranty Trust Bank (GTB) to calculate and remit Value Added Tax (VAT) on commissions received from the Remita platform between 2015 and 2022 to the Federal Government’s recovery account.

This directive was issued by the Chairman of the Public Accounts Committee (PAC), Rep. Bamidele Salam (PDP-Osun), during an ongoing investigation into alleged revenue leakages associated with the Remita platform.

The PAC’s resolution, reached unanimously after scrutinizing records and hearing from GTB’s management, raised concerns over the non-remittance of VAT during the early phases of Remita transactions. The committee is also examining other potential compliance issues, including adherence to standard operating procedures.

GTB’s Executive Director, Mr. Ahmed Liman, explained that the bank had not remitted the VAT for eight years because it believed that Remita had already deducted the tax before distributing commissions to the bank.

READ ALSO: GTBank denies website cloning amid hacking attempt, says customer data safe

“We believe that Remita is responsible for sharing commission fees between the payment receiving parties. In our mind, we think Remita has done the needful before sharing the fees between the parties,” Liman stated.

He further disclosed that GTB charged a 0.75% fee on transactions processed via Remita and received N254.4 million from the Accountant General through the platform in 2018.

In addition to GTB, representatives from other banks, including Keystone, Zenith Bank, Sterling Bank, Polaris Bank, FCMB, Ecobank, and Wema, also appeared before the committee. These banks were referred to a reconciliation sub-committee to address discrepancies in their submissions and will be scheduled to reappear before the committee.

Remita, developed by SystemSpecs, is a financial gateway technology used by the Federal Government for revenue collection into the Treasury Single Account (TSA) from Ministries, Departments, and Agencies (MDAs). The platform also facilitates the remittance of various taxes, pension contributions, and other payments for both government entities and private individuals.

As the investigation continues, the PAC’s directive highlights the broader efforts by the House to ensure compliance with tax laws and the proper management of public funds. Further developments are anticipated as the committee delves deeper into the matter.