Tax evasion: FIRS arrests 13 hotel CEOs

The Federal Inland Revenue Service has arrested the chief executive officers of 13 hotels in Abuja.The arrest on Thursday was part of measures aimed at ensuring that all tax payers in the country are captured in the tax net.Coming just about one day after it arrested the Executive Secretary of the Federal Capital Development Authority, Mr. Adamu Ismaila, for not remitting N28.27bn taxes, the move caught most of the hotel CEOs unawares.Some of the hotels, whose CEOs were arrested are Ajis Prime Resort, Garden Restaurant/Guest House, Regal Lodge, Christop Hotels, Airport Road Inn and Resort as well as Silver Gate Hotels, among others.The enforcement followed the expiration of a notice given to the firms, to comply with the tax legislation or face punitive action.About N170bn is said to be outstanding tax liabilities currently being owed the FIRS by tax defaulters.The huge tax liabilities had made President Goodluck Jonathan to direct the FIRS to ensure that all outstanding tax obligations were recovered within the shortest time possible.Addressing journalists shortly before the clampdown, the FIRS Deputy Director, Special Tax Office, Federal Capital Territory, Mr. Peter Olayemi, said the arrest became imperative following the failure of the companies to register for tax remittance.Their action, he noted, violated Section 41 of the Companies Incomes Tax Act of 2004 and Section 8 of the Value Added Tax Act of 1993.These sections stipulate that all companies registered with the Corporate Affairs Commission and operating as businesses are to register as tax payers and submit tax returns.Findings revealed that most of the companies whose CEOs were arrested had not filed any tax returns since the inception of operations, despite a series of notice to them from the FIRS.Justifying the enforcement, Olayemi said that section 33 of the FIRS establishment act empowers it to enforce compliance with tax laws at the expiration of notification without further recourse to such companies.He said, The management of FIRS mandated its regional offices to assist tax payers to comply with the provision of tax laws.
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