Lagos State Internal Revenue Service (LIRS) Shuts Down 34 Companies over N356.12m Tax Debts

In a statement released on Tuesday, the Lagos State Internal Revenue Service (LIRS) has announced the closure of 34 corporate organizations and 23 hotels, restaurants, and event facilities for various tax infractions. The closed organizations failed to remit Personal Income Taxes of their employees and neglected to remit consumption taxes to the Lagos State Government, as disclosed by Monsurat Amasa-Oyelude, the Head of Corporate Communications at LIRS.

Mr. Seyi Alade, LIRS’s Director of Legal Services, made the announcement during a state-wide tax law enforcement exercise conducted by the Service in Lagos on Monday. The statement mentioned some of the closed companies, including NTS Nigeria Ltd., Med-In Hospital & Pharma Services Ltd., Danvic Petroleum Int’l Ltd., Business Intelligence Technology, Avaya Nigeria Ltd., Gladstone Tech Ltd., Courier Plus Services Ltd., Kurioucity Ltd., Medilag Ventures Ltd., Future Oilfields, and Seven Six & Ten Limited.

The operation also led to the closure of hotels such as Blitz Suites & Hotel, Offshoroomz Hotel, God’s Grace Hotel, De Orange Place Ltd., De Santos Hotel, Kentade Hotel Limited, Chamcee, Chelsea Suites, Falode Hotels, High Climax Hotel, Chez Moi Apartment, Excellence Hotel, Bereans Venture (Tantalizer Ebute Metta), La Avril Hotel & Suites, De Orange Place Ltd., Milaco Guest House, New World Inn, Model Motels Ltd, Rely Maritime Ltd, 4 Seasons Hotel, Dream Land Hotel, 343 North Restaurant and Lounge, and Jade Palace Chinese Restaurant. The total tax liabilities of the companies and hotels amounted to more than N356.12m, causing a significant revenue loss for the Lagos State Government.

According to Alade, the LIRS had previously focused on voluntary compliance by taxpayers but had to increase its enforcement activities due to tax evasion by certain firms. The goal of these enforcement activities is to ensure compliance with the remittance of Consumption and Personal Income taxes, allowing the government to undertake projects for the well-being of Lagos State residents.

Alade warned that failure to file tax returns or engage in tax evasion would be considered criminal offenses, potentially leading to financial penalties and even custodial sentences upon conviction. The LIRS is currently prosecuting high-net-worth individuals and companies that failed to file their returns, with bench warrants issued and three arrests made so far.

The LIRS stressed that the enforcement exercise will continue in order to ensure tax compliance.