The new tax regime of the Lagos State Government suffered a setback as a Federal High Court has restrained the government from enforcing the provisions of its new Hotel Occupancy and Restaurant (Fiscalisation) Regulations 2017.
The law introduced a five per cent consumption tax apart from the five per cent Value Added Tax on every purchase or service rendered by hotels, restaurant, fast food outlets, event centres, bars and night clubs.
The restraining order was given by Justice Rilwan Aikawa.
With the order, the government was prevented from enforcing the law pending the final determination of a suit filed against the government by the Registered Trustees of Hotel Owners and Managers Association of Lagos.
The Hotel Occupancy and Restaurant Consumption Law Cap H8, Laws of Lagos State 2015, was also temporarily struck out by the court.
The court was particular about paragraphs 4, 5, 6, 7, 8, and 11 of the Lagos State Hotel Occupancy and Restaurant (Fiscalisation) Regulations 2017.
It said the government should not enforce them.
The order of the court followed an ex parte application by the association of hotel owners in Lagos State to that effect.
The association was represented by its counsel, Mr. Olasupo Shasore (SAN).
The association prayed the court to stop the state and its agents from visiting its members “between March 1 and March 10, 2018 or any other period before or thereafter,” pending the hearing and determination of a motion on notice dated March 7, 2018.
The Attorney General of Lagos State and the Federal Inland Revenue Service were joined as defendants in the suit marked FHC/L/CS/360/2018.