The Lagos State Government has sued 686 companies for evading tax to
the tune of N11.1 billion.
The cases were filed at the High Court of Lagos in a bid to retrieve
the money, says Chairman, Lagos Internal Revenue Service, Tunde
Fowler, at a ministerial news conference in Ikeja, Lagos.
He said out of the 686 people taken to court in 2014 for tax evasion,
the court granted government order to collect taxes from 376
companies, amounting to N8.1 billion, but that only N771 million was
recovered.
“We filed 686 cases at the State High Courts at the beginning of the
year with a total liability of about N11.6 billion. Out of  theses, we
received destraining orders on 376 cases. This amounts to a liability
of about N8.1 billion. Of this, they have paid N771 million.
“When a tax payer disagrees with the tax he is expected to pay and
both the tax officials and the payer couldn’t reach a compromise, both
parties go to court. And the court will grant us some order of
destrain; to close that organization.
“After that destrain, and they make a payment, we will give room for
the tax payer to bring additional evidence on why he cannot pay such
fee. And that was why we always have difference in the amount that we
took to court and the amount that was paid,” he explained.
On consumption tax, Fowler said in terms of compliance level,
government had over 2,600 outfits that were paying this tax, adding
that “we have their cooperation while the case was still in court.”
In the Internally Generated Revenue, IGR, he disclosed that the
government currently collects N23 billion on monthly basis.
“The high months of collection are usually in April, May and June.
These are the months when companies declare dividends and staff go on
leave and they get their leave allowance.
“In terms of our actual collection, we didn’t increase in IGR. In
2013, we had approximately N236 billion while in 2014 it was N276
billion. So we went from an average of N20 billion in 2013 to an
average of N23 billion. That was one of the things that has kept the
state working. The informal sector is yet to pay taxes despite the
fact that some of these people get paid for their services. They are
about three million people in the state. The objective of taxation is
to distribute wealth,” he said.
Also speaking, Special Adviser to the Governor of the State on
Taxation and Revenue, Bola Shodipo announced a 50 per cent increase in
taxpayer population between 2011 and this year.
He said as a result of increased public confidence in the government
of Mr. Babatunde Fashola, the taxpayer population increased from 2.7
million in 2011 to 4.5 million this year.
Shodipo, who put the population of voluntary taxpayers at 3.8 million
in 2014, said aside from the traditional due recognition to the most
tax compliant individuals and organisations, there was also a
correspondent increase in the number of Electronic Tax Clearance
Certificates issued during the year under review.
The Special Adviser said an additional 19,640 properties were
enumerated during the year under review bringing the total number of
properties enumerated by his office for Land Use Charge (LUC) to
663,913, adding that out of 5,893 complaints arising from the issue,
5,223 were resolved while the remaining were still pending at various
stages of settlement.
Announcing an improvement in the delivery of bills by his office with
the introduction of the e-billing system, Shodipo appealed to members
of the public to embrace the system to enable them benefit from the
improved service delivery which, according to him, informed its
introduction.