The Lagos State Government Tuesday announced that it has set up a revenue court that will prosecute tax evaders and defaulters.
This revelation was made by the State Attorney General and Commissioner for Justice, Adeniji Kazeem, during a press conference at Bagauda Kaltho Press Centre, Alausa Secretariat, Ikeja.
Mr Kazeem revealed that in view of the extreme financial downturn, there was the strong need for government to ramp up its Internally Generated Revenue (IGR), stressing that the state would spare nothing in enforcing the laws regulating tax payment.
He added the administration of Governor Akinwunmi Ambode had put in place necessary measures to end the era of tax evasion and indeed avoidance in the state, adding that tax avoiders and evaders would be aggressively pursued in line with the provisions of the law.
The commissioner, who disclosed that the Ministry of Justice had established a Rapid Tax Prosecution Unit to aid the Lagos Internal Revenue Service (LIRS) in its drive to collect taxes, added that the unit would work closely with the Revenue Court which the Chief Judge of Lagos State recently agreed to set up.
Hear him: “Prosecution and jail term for defaulting tax payers will be a tool that we will be actively using to ensure full compliance. Tax officers, I understand, will be very aggressive in their collection of taxes and the public is hereby advised to cooperate with them because obstruction of these tax officers in their lawful duty can and will lead to prosecution.
“Tax dodgers watch out because the long arm of the law will eventually reach you. All tax payers are also reminded that giving false information is also an offence and can be used in the prosecution of your tax default. If you pay your taxes regularly, you will have no problem,” Kazeem warned.
Commissioner for Finance, Mustapha Akinkunmi, also disclosed that the state generated at least N24.5billion from IGR in the month of January 2016, in line with the efforts of the Ambode administration to reform its tax system and develop a tax paying culture.
Akinkunmi said in the light of the reduction of federal transfers to states including Lagos, the state government was looking inwards to secure sustainable ways of increasing its revenue profile and plugging leakages in the system.
He said majority of the state’s IGR is generated through tax collection, administered by the LIRS.
According to Akinkunmi, the LIRS contributed 79 per cent to the IGR in 2015, which equates to 56 per cent of the state’s total revenue including federal transfers, adding that the revenue is expected to continue on an upward swing, driven by strong tax collection.
In his words, “This trend of strong performance is continuing. In January this year, LIRS has contributed N24.5billion in revenue, attaining 98 per cent budget performance for the month and recording 12 per cent growth from the same period in 2014.”
Executive Chairman of LIRS, Mr. Olufolarin Ogunsanwo, revealed that the Lagos State government has also put in place a method to ease payment of taxes in the state.
Hear him: “We have revised the existing 6-page Form A to a 2-page Form which will be used for direct and self-assessment. The revised form and its guidelines will be translated to Pidgin, English and Yoruba for ease of completion and wider reach.”
He added, “We shall also be activating the provision of 1% incentive self-assessment in accordance with Section 45 of PITA 2004 as amended. This is a statutory obligation which we have promised to uphold.”
Ogunsanwo pointed out that the agency has concluded all arrangements to ensure that maximum response time of 72 hours to all electronic tax clearance certificate (e-TCC) requisitions is met and failure should be reported to any customer care desk.
He disclosed that the current cumbersome requirements for replacement of lost e-TCC such as police report and sworn affidavit are to be waived and replaced with presentation of LASRRA Card while the replacement fee is to be reduced from N2,500 to N1,000.
Specifically the chairman stated that the agency has commenced the process of overhauling of the informal sector operations with a view to easing voluntary compliance by tax payers in this huge sector that have been categorised into three which include the market men/women and artisans, micro, small and medium scale enterprises (including professionals) and household domestic staff (HDS).
In view of the declining revenue from the centre as a result of fall in the price of crude oil, Ogunsanwo revealed that LIRS is poised to focusing on other revenue sources such as Consumption Tax from Hotel Occupancy, Withholding Tax on Contracts, Rent, Royalties and other areas to shore up the Revenue in the State.
