Hoteliers’ suit against LASG over hospitality tax adjourned till Jan. 17

A Federal High Court, Lagos, today, further adjourned till January 17, 2019, for the hearing in a suit instituted by the Registered Trustees of Hotel Owners and Managers Association in Lagos, challenging the new Hotel Occupancy and Restaurant Consumption Laws of Lagos State.

The suit, marked FHC/L/CS/360/2018, has the Attorney General of Lagos State and the Federal Inland Revenue Service as defendants.

The hearing of the suit which was scheduled to today, was adjourned till new date following the absence of the judge, Justice Rilwan Aikawa, who is said to away for another court sitting in Sokoto.

In the suit, Mr Olasupo Shashore (SAN) is counsel to the plaintiffs, while Mr Lawal Pedro (SAN) appears for the State.

At the last adjourned date on March 21, the court had issued an interim order, restraining the defendant from enforcing the provisions of its new Hotel Occupancy and Restaurant Consumption (Fiscalisation) Regulations 2017.

The Law introduces an increase in consumption tax, in addition to a Value Added Tax on every purchase or service rendered by hotels, restaurants, fast food outlets, bars and night clubs.

In his ruling, Justice Aikawa had issued an interim order, restraining the State from further enforcing the law, pending the determination of the case.

In its substantive suit, the plaintiff is urging the court to strike out the Hotel Occupancy and Restaurant Consumption Law Cap H8, Laws of Lagos State 2015.

They are urging the court to restrain the State from enforcing or implementing paragraphs 4, 5, 6, 7, 8, and 11 of the Lagos State Hotel Occupancy and Restaurant (Fiscalisation) Regulations 2017.

The plaintiff is also asking the court to restrain the defendants, its agents from visiting members of the plaintiffs “between March 1 and March 10, 2018, or any other period before or thereafter,” pending the determination of the motion on notice.

The plaintiffs contends that in 2009, the Lagos House of Assembly enacted the Hotel Occupancy and Restaurant Consumption Law, which seeks to impose tax on goods consumed in hotels, restaurants, event centres, or night clubs within Lagos.

They argue that by section 9 of the Law, the first defendant through the Lagos State Internal Revenue Service (LIRS) is empowered to make regulations for the collection and remittance of taxes, and for proper administration of the Law.

According to the plaintiff, in exercise of its powers, Chairman of the LIRS has now made the Hotel Occupancy and Restaurant Consumption (Fiscalisation) Regulation 2017.

They argue that the Regulation is made to set out measures which allows the first defendant through the LIRS, to commence enforcement of the Law, on members of the plaintiff.

The plaintiffs are therefore, urging the court to grant their reliefs sought.

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