A LAW TO IMPOSE TAX ON GOODS CONSUMED AND SERVICES RENDERED IN HOTELS, RESTAURANTS, EVENTS CENTRES AND OTHER FACILITIES THEREOF IN EDO STATE.
BE IT ENACTED BY THE EDO STATE HOUSE OF ASSEMBLY AND BY THE AUTHORITY OF THE SAME AS FOLLOWS:
1. This Law may be cited as the Hotels and Events Centres Occupancy and
Restaurants Consumption Law of Edo State and shall come into effect
on the…………..day of……………………………2011.
2. In this Law, unless the context otherwise requires:-
"Consumer" includes a hotel guest or any person who makes use of a hotel, restaurant, event centre or hotel facility for a fee;
"Events Centres" includes halls, auditoria, fields and places designated for public use for a fee:
"Government" means the Edo State Government:
"Hotel" includes a motel, guest house, apartment for short letting, tavern, meeting room, and function hall, whether or not described as a hotel by the operator;
Hotel facility" includes a room, suite, hall, open space or other facility or resource centre which may be let out for a fee within a hotel or other
facility covered by this Law under a lease, concession, permit, right of
license, contract, or other agreement.
"Restaurant" includes any food sale outlet, bar, tavern, inn or café whether or not located within a hotel;
"State" means Edo State of Nigeria;
"Transferee" includes purchaser, assignee, lessee, licensee or other successor in title;
"Transferor" includes seller, assignor, lessor or licensor, or other successor in title;
"Person" includes a body corporate.
3. (1) A tax is imposed on any person (referred to in this Law as "the Consumer") who-pays for the use of any hotel, hotel facility or events centre: or
(b) Purchases consumable goods or services in any restaurant whether or not located within a hotel in Edo State.
(2) The amount to which this tax applies shall be the total cost of
facilities, consumables or personal services supplied to a consumer in, by or on behalf of the hotels, restaurants or events Centres.
4. The rate of tax imposed by this Law shall be five percent (5%) of the total bill
issued to the consumer.
5. A person owning, managing or controlling any business or supplying any goods or
services chargeable under Section 3 of this Law (referred to in this Law as the "Collecting Agent") shall collect for and on behalf of the State, the tax imposed by this Law based on the total amount charged or payable by the consumer in accordance with the provisions of Section 4 of this Law.
6. The tax charged by this Law shall be under the care and management of the Edo State Board of Internal Revenue (referred to in this Law as "The Board")
7. (1) Any Hotel, Restaurant or other business affected by this Law shall, within 30 days of the commencement of this Law or upon commencement of business, whichever is earlier, register with the Board for the purpose of this Law.
(2) Every Collecting Agent shall produce evidence of registration with the Board as a condition precedent to any contractual relationship with the State Government or any of its Ministries, Departments, Agencies, Parastatals or Local Government Councils.
8. (1) Every Collecting Agent shall:
(a) Keep, maintain and preserve such records, books and accounts in respect of all transactions chargeable under Section 3 of this Law as the Board may prescribe and shall enter regular accounts of the tax collected from day to day.
(b) subject to the provisions of subsection (5) of this Section, pay to the designated account of the State Government, the tax collected during the preceding reporting period and at the same time, file with the Board a report stating:-
(i) the total amount of payments made for all chargeable transactions during the preceding reporting period;
(ii) the amount of tax collected by the agent during the reporting period; and
(iii) any other information required by the Board to be included in the report.
(2) For the purpose of these provisions, each calendar month is a reporting period and the taxes imposed and collected under this Law are due and payable on or before the 7th day of the following month.
(3) The tax collected shall be a debt due to the State and recoverable by the Board from the supplier of chargeable facilities, goods and services.
9. An officer of the Board:-
(1) may enter without warrant, any premises on which he reasonably believes that a person is carrying on business in order to ascertain whether this Law is being complied with by the Collecting Agent.
(2) shall at any reasonable time of the day be given access to all books and records of any hotel, restaurant or other establishment offering chargeable goods and services for the purpose of verifying facts necessary to determine the amount due and payable to the Government under this Law.
(3) it shall be an offence for any person to prevent any officer of the Board from having entry into the premises or access to the Records of the Collecting Agent.
10. Where a Collecting Agent fails to make a return or remittance as required by the provisions of this Law or where his returns are not substantiated by records, the Board may make an estimate of the total amount of tax due and may order the person in writing to pay the estimated amount to the Board within 21 days of the date of service of the order.
11. The Board may from time to time by Order published in the Gazette, issue rules and regulations for the determination, collection, and remittance of taxes due and for the proper administration of this Law
12. All taxes that are not remitted to the Board within the time allowed, shall in addition to other penalties prescribed by this Law, bear interest at the rate of two percent (2%) per annum above the prevailing Central Bank of Nigeria
Minimum Re-discount Rate as determined at the time of actual remittance.
13. If a Collecting Agent fails to file a report and remit taxes collected within the time allowed by Section 8(2) of this Law, that Agent shall, in addition to interest payable under Section 12 of this Law, pay a penalty of ten percent (10%) of the amount of tax due.
14. Any Director, Manager, Officer, Agent or Employee of the Collecting Agent who fails to comply with the provisions of this Law, shall be guilty of an offence and liable on conviction to a penalty of not more than Six (6) months imprisonment or a fine of Two Million Naira (N 2,000,000.00) or both depending on the size of business.
15. (1) When a hotel, restaurant or other facility covered by this Law is sold or otherwise disposed of, the transferee shall withhold such amount of the purchase price or other consideration as is sufficient to offset all payments already due to the Government under the provision of this Law, unless the transferor has first provided a receipt issued by the Board showing that the amount due at the date of transfer had been paid or that no amount was due.
(2) A transferee of a chargeable facility who fails to comply with the provisions of subsection (1) of this Section shall be liable to pay the account and the provisions of Sections 12 and 13 of this Law shall apply as if he was operating the hotel business at the time the payments were due.
(3) The transferee of a chargeable facility may for a fee to be determined by the Board request from the Board a certificate stating that no tax is due or stating the amount of tax due from the facility at the date of transfer.
(4) In the case of a request made under subsection (3) of this Section, the Board shall issue certificate within 14 days of receiving the request or within 14 days after the day on which the relevant records of the business are made available for audit, whichever is later, but in either event, the Board shall issue the certificate within 30 days after the date of request.
16. (1) Any person aggrieved by any assessment made by the Board under this Law shall within seven (7) days of being notified of such decision write to the Chairman or other designated Officer of the Board requesting the Board to review, amend or reverse the assessment.
(2) Upon the receipt of such notice, as mentioned in subsection (1) of this
Section, the Board may reconsider, affirm or amend its assessment and notify the complainant of its decision.
(3) Where upon a review, the Board serves on the complainant a notice of
refusal to amend, a complainant who is dissatisfied by the refusal may
institute an action at the High Court of Edo State.
(4) Where the person served with an assessment or his authorized
representative fails to contest the assessment within the period allowed by subsection (1) of this Section, the assessment shall be deemed to be final and conclusive.
17. (1) The Board may institute an action at the High Court of Edo State for the recovery of taxes, interests and penalties due under this Law.
(2) All revenue recoverable under this Law are revenues of the Edo State Government and accordingly, all legal actions taken in relation to this Law or anything done pursuant to it shall, subject to the provision of Section 16 of this Law, be instituted at the High Court of Edo State.
(3) Where an ex-parte application is made to the Court supported by affidavit that there is reasonable cause for suspecting that a Collecting Agent or any other business organization or person is in contravention of any provision of this Law, the Court may make an Order upon such terms as it deems fit to:-
(a) prevent concealment of the fraud or dissipation of monies due to the Government; or
(b) authorize officers of the Board to enter the premises of the suspect at any reasonable time of day or night accompanied by police officers; to
(i) inspect the premises for any evidence of contravention; and
(ii) seize any books of account, records or other things by which the liability of the Collecting Agent, business organization or other person may be established.
(4) Any person who knowingly gives false information to the Board shall be guilty of an offence and liable on conviction to imprisonment for a period of six (6) months or a fine of Five Hundred Thousand Naira
(N 500,000.00) or both
18. (1) Without prejudice to any other power conferred on the Board for the
enforcement of payments due to Government under this or any other Law, where an assessment has become final and conclusive and a demand notice has been served on a person to make payment, and payment is not made within the time limited by the demand notice, the Board, shall in the prescribed form, for the purpose of enforcing payment of the tax due:-
(a) distrain the defaulter by his goods or other chattels, bonds or other securities.
(b) distrian upon the relevant facility or other place in respect of which the defaulter is the owner, and subject to the provisions of this Section, recover the amount of tax due by sale of any of the things so distrained.
(2) The authority to distrain under this Section shall be in such form as the Board may direct and that authority shall be sufficient warrant to levy by distrain, the amount of tax due.
(3) For the purpose of levying a distrain under this Section, an officer
authorized in writing by the Board may execute a warrant of distrain, and if necessary, break open any building or place in the day time for the purpose of levying the distrain and may call to his assistance, any police or other security officer whose duty, when so required, shall be to aid and assist in the execution of the warrant of distrain and levying the distrain.
(4) Things distrained under this Section may, at the cost of the defaulter, be kept for fourteen (14) days and at the end of that time, if the amount due in respect of the tax and the cost and charges incidental to the distrain are still not paid, may subject to the provisions of sub-section (6) of this Section, be sold at anytime thereafter.
(5) Out of the proceeds of a sale under this Section, there shall be paid the cost or charges incidental to the sale and keeping of the distrain, and the amount due in respect of the tax. The balance (if any) shall be payable to the defaulter by the Board.
(6) Nothing in this Section shall be construed as authorizing the sale of an immovable property without an Order of the State High Court, made on application in such form as may be prescribed by the Rules of Court.