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BDCs disown petitions against dual exchange rate regime

By Chijioke Nelson
31 December 2019   |   4:20 am
The Association of Bureaux De Change Operators of Nigeria (ABCON) has dissociated itself from the petitions against the apex bank and its management over the deployment...

•Demand removal of VAT on transactions
The Association of Bureaux De Change Operators of Nigeria (ABCON) has dissociated itself from the petitions against the apex bank and its management over the deployment of dual exchange rate regime in foreign exchange (forex) management.

The currency dealers said they are fully aware that the N305/$ rate, currently proposed by the petitioner for Bureau De Change (BDC) operators is not transactional rate, but only used for settling government obligations.

Besides, they pointed out that no BDC or service provider gets forex at N305 per dollar, dismissing the petitioner’s claims as a complete falsehood.

Meanwhile, they have applauded the Central Bank of Nigeria (CBN) on its foreign exchange allocation policy, which they also believed had brought about the stability of the naira against the dollar.

ABCON President, Alhaji Aminu Gwadabe, who faulted the petition, said the CBN-licensed operators’ submission to the National Assembly was about the Value Added Tax (VAT) exemption and a downward review of licence fee renewal.

According to him, CBN’s forex policy has brought stability to the BDC segment and helped the operators to embrace automation, which is the standard practice globally.

“This is the handiwork of unknown faces, not ABCON. It is confrontational and lack credible evidence. The petitioner was never at any time appointed to speak on behalf of BDCs,” he said.

Meanwhile, ABCON has affirmed the appointment of Mike Akinfolarin & Associates as its Consultant/Tax Attorneys on VAT, saying that the charges are bigger problem confronting operators.

Already, the company made a representation on behalf of ABCON over VAT charges before the National Assembly’s public hearing/House of Representatives Committee on Finance Bill.

Gwadabe noted that a large part of their income go into paying taxes, adding that in other economies, foreign exchange rate control by government is VAT exempt.

He explained that beyond the rates differentials, Nigeria needs multiple streams of forex earnings, saying that the enlisting of more channels to attract Diaspora remittances and other foreign capital that will not only deepen the market, but keep the naira stable.

“ABCON believes there is need to make BDCs one of the channels for receiving Diaspora remittances into the economy to create more income for operators. BDCs remain at the centre of economic development and have the capacity to attract needed capital for the development of the Nigerian economy.

“Other great areas to focus for diversifying our foreign exchange earnings include promoting Diaspora remittances for economic buffer and foreign reserves accretion as seen in India and United Arab Emirates where migration remittances have lifted their economies,” he said.