Edo State Governor, Comrade Adams Oshiomhole has assented to the Hotels and Events Centres Occupancy and Restaurants Consumption Tax Law recently passed by the House of Assembly.
The Law envisages the imposition of a consumption tax on any person who pays for the use of any hotel, facility or event centre. The tax will also be paid by anyone who “purchases consumable goods or services in any restaurant whether or not located within a hotel in Edo State”.
Section 2 of the Law says: “The amount to which this tax applies shall be the total cost of facilities, consumables or personal services supplied to a consumer in, by and on behalf of the hotels, restaurants or event centres”.
The rate of tax imposed by this Law which is five per cent of the total bill issued to the consumer shall be under the care and management of the Edo State Board of Inland Revenue.
Section 5 of the Law states that “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”.
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.
The Law also imposes fines on the collecting agent for failure to file a report or remit taxes collected within the time allowed.
Section 13 says: “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 per cent (10%) of the amount of tax due”.
Section 14 also says: “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 (N2,000,000) or both, depending on the size of business”.