LIRS unveils E- payment for remittance of hotel consumption tax
Picture Caption:
Representative of Lagos State Governor and Deputy Governor, Dr. (Mrs) Oluranti Adebule (middle); Chairman, Lagos State Internal Revenue Service (LIRS), Mr. Ayodele Subair (Left); Commissioner for Finance, Mr. Akinyemi Ashade (2nd right); his counterpart for Tourism, Arts & Culture, Mr. Steve Ayorinde (right) during a Stakeholders’ meeting on Fiscalization of Hotel Occupancy & Restaurant Consumption Tax Law at the Banquet Hall, State House, Alausa, Ikeja on Thursday, February 22, 2018.
In its effort to leverage on e-payment and multi-modal payment portals, the Lagos State Internal Revenue Service (LIRS) has unveiled an automated invoicing system and technology device, Electronic Revenue Assurance system (ERA), at a stakeholders’ meeting held with hotel and business owners in the hospitality and Tourism sector of Lagos state at the Banquet Hall, State House, Alausa, Ikeja on Thursday, February 22, 2018.
The stakeholders’ meeting highlighted the benefit of improving profit, sustenance of cash flow and reduction in revenue leakage for hotels, restaurants, nightclubs, bars and event centers owners in Lagos state through the ERA device.
Speaking during the stakeholders meeting on Fiscalisation of Hotel Occupancy and Restaurant Consumption Tax Law, the Lagos State Governor, Mr Akinwumi Ambode disclosed that the state 2017 budget recorded 82 percent performance.
Governor Ambode who was represented by the Deputy Governor, Idiat Oluranti Adebule reiterated his commitment to make Lagos state one of the largest economy and smartest cities in the world.
He enjoined the residents and business owners in Lagos state to key into the new ERA by promptly paying their consumption taxes through the newly introduced technology
“Funds are required to enable government to actualize its objective of the provision of adequate infrastructure and services for the residents of expected of a mega city. Prompt payment of taxes is the way in which government is able to finance its activities.”
He stated that the stakeholders meeting became necessary to put in place machinery for tax collection and also to ensure compliance.
The Governor stated further that the Lagos Inland Revenue Service, LIRS will work with the the state Attorney General Office to ensure compliance and also to make sure that defaulters are brought to book.
The Governor said the state has invested heavily on infrastructure and is still investing despite the difficult time, adding that this will enable the state to rely less on federal funding and depend on state funding.
Speaking also at the event, the State Commissioner of Finance, Mr Akinyemi Ashade listed the benefits of the introduction of technology on the collection of State Hotel Occupancy and Restaurant Consumption Tax Law to include, enhancing credibility, enhancing access to credit, enhancing easy payment system, help clarify concern of industry stakeholders and to ensure that there is a win-win situation for stakeholders.
He assured the stakeholders who are calling for the enforcement of the tax law across board, both for small restaurants and Mamaput sellers that measures will be put in place to capture every segment of the business, including the well patronised illiterate Mamaput sellers.
He told the stakeholders that they do not need to panic as the tax is not targeted at them, but their customers, stating that the operators are just the collecting agent for the state.
In his opening remarks earlier, the chairman Lagos State Inland Revenue Service, LIRS, Mr. Ayodele Subir stated that the electronic revenue system will help facilitate the compliance of Tax Law.
He explained that this will entrench global best practices.
According to the Chairman of LIRS, Mr. Ayodele Subair: “The hotels, restaurants, nightclubs, fast food outlets, bars, event centers among others serve as agents of the government for the purpose of remittance of 5percent consumption tax collected from customers through the LIRS new technology, Electronic Revenue Assurance System (ERA).
The chairman also stated that the commencement of the new system takes effect immediately as LIRS officers will be visiting hospitality places to install the software and train their staff on the use of the new device.
The Electronic Revenue Assurance System (ERA) is a software application/device that issues invoices and receipts to consumers bearing a unique QR code. The receipt will also contain detailing of the items and/or services ordered and an embedded automation of Consumption Tax remittance in real time.
Subair said the tax payers will benefit from this tax in the area of provision of infrastructure.
LIRS revenue boss pointed out that is not like the state is introducing new tax law, but an already existing law passed in 2017.
In the same vein, the State Commissioner of Economic Planning and Budget, Mr Olusegun Banjo said the tax law will fill the gap on the revenue process.
Banjo stated that adequate monitoring system will be factored into the system to ensure compliance.
He observed that lack of funding in the state will create problem for the state.
Banjo noted that the rate at which people comes to Lagos makes the infrastructure to deteriorate faster.
In his response, the President of Lagos hoteliers association, Mr. Adekunle Akilo noted that sensitization and training process for effective utilization of the device should be continuous to help business owners and consumers in the hospitality industry fully embrace the technology.
Commenting also to the tax law, President of Association of fast food confectioners of Nigeria and proprietor of Sweet Sensation, Mrs Kehinde Kamsom assured that their members will support Lagos state government on compliance and remittance.
Mrs Kamson called on the State Government to enforce the law across board including Mamaput sellers.
She observed that even some of the Mamaput seller are making more money than them as they are patronised even by the bank managers who sent people across to buy food for them.
Kamson lamented that this tax will further over burden them as any additional charges on their customers will force them to look for the services of Mamaput sellers.
She said: “Government will be looking at the formal setting of eateries with the aim of implementing the law, not knowing that some of these so called Mamaput and others are making more money than us, about 20 percent of the eatery outlets have closed shops as we are overburdened by staff salaries, pension and all that and once you put extra charge on that customers, you have lost him/her as he will not come back to that restaurant again”.
In the same vein, the stakeholders echoed the opinion of Kamson on the issue of putting extra tax burden on their customers who they said will be forced to look for somewhere cheaper to buy, adding that “like beer , a customer may be forced to even patronise mamaput shop close to the gutter to buy beer at cheaper cost provided the beer is cold”.
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