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Lagos drags 50 firms to court for tax evasion

By on November 18, 2014

The Lagos State Government on Sunday said it had begun the prosecution of over 50 corporate organisations and individuals who allegedly defaulted in paying their taxes in accordance with the state’s tax laws.

The Chairman of Lagos State Internal Revenue Services (LIRS), Mr. Babatunde Fowler, disclosed this at a news conference in Alausa, saying the firms “have been taken to courts for evading tax payment in the state.”

Fowler said the LIRS “is currently doing tax audit on many multinational and local companies to establish their tax liability, with a view to taking appropriate action against them.”

According to the chairman, the tax audit carried out by LIRS showed that some companies are defaulting and not fully remitting taxes of their employees to the government.

He cited the case of Huawei Technologies Companies Nigeria Limited, which he said, was owing the state government about N988 million contrary to N212 million the company paid to the state government in 2013.

He said: “LIRS has begun investigation into Huawei Technologies Company Nigeria Limited. We have also told them to give certain information including their monthly immigration reports which every expatriate company must provide.

“We are currently still in discussion with the company on 2013. If we cannot resolve the issue in the next one or two months,  then those  cases will go to court,” Fowler said.
He added that several letters had been written to the company to comply with the tax law, adding that LIRS would look into all the documents sent it by Huawei Technologies.
The chairman said: “When the company does not provide information timely, we write letters to inform them that we will proceed on legal action against such company.
“You may ask us how we get to N988 million. We have what we call industry average rate. Based on the expatriates that they said they have here, they have 901 expatriates. We looked at the industry that they are in. We take an average pay of what those staff earn in other companies.”
“LIRS is verifying the basis of their objection. If the state government is not satisfied with the records provided by the company, it may approach the court to get the power to shut the company.
The LIRS boss said the organised private sector, especially those on the platform of theManufacturers Association of Nigeria (MAN) and Nigeria Employers Consultative Association (NECA) were over 95 percent tax compliant
Fowler added that these companies “have challenges with the unorganised and informal sub-sectors of the economy.”

 

[ThisDay]