SHAWWAL 8, 1429 A.H.
FRIDAY OCTOBER 6 2008
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Stakeholders shun debate on hospitality bill
Lagos state lawmakers has expressed shock at the low turn-out of stakeholders at a public hearing on a bill.
The bill is to impose tax on goods and services consumed in hotels, restaurants and events centres in the state.
When passed into law, the bill will empower the government to charge five per cent of the total bill issued to guests and other customers in the hospitality industry.
The charge, however, excludes the Value Added Tax (VAT) already in operation.
Adeola Olamilekan, the House Committee Chairman on Finance, said it was unfortunate that stakeholders did not show up at the public hearing in spite of earlier notice in the dailies.
He noted that apart from the dailies, letters were also sent out to stakeholders to ensure attendance.
Mr Kolawole Taiwo, the House Majority Leader, who represented the Speaker, Mr Adeyemi Ikuforiji, condemned the act.
Taiwo said that although it was not mandatory for the views of the public to be sought before a bill was passed, the House had made public hearings its tradition to carry the people along.
He said that stakeholders might not be able to make necessary inputs due to low attendance.
While explaining the need for the tax, the lawmaker said that it would be used for infrastructural development in the state and enhance its tourism potential.
However, stakeholders at the public hearing expressed dissatisfaction with the bill, saying it would amount to multiple taxation.
They said that the hospitality industry was already saddled with the burden of various taxes being charged in the state.
They also complained of harassment by council officials over tax payment alongside payment of VAT to the Federal Government.
Mr Timothy Olawale, Executive Secretary, Hotel and Personal Services Employers Association of Nigeria, commended the government for its efforts at improving tourism in the state.
He, however, said that additional tax would amount to
``multiplicity of taxation``.
Olawale said that additional tax would make the state the most expensive tourists destinations in the country.
``Government should work more on inducement to attract tourists to the state rather than imposing consumption tax``.
Akilo Adekunle, First Vice President, Hoteliers Association, Lagos Chapter, condemned the tax, saying that the state was already getting its own share of the taxes imposed by the Federal Government.
``If the government wants consumption tax, it should use its powers to stop VAT,`` Adekunle said.
Ade Ipaye, Special Adviser to the Governor on Taxation, described sales and consumption tax as the sole constitutional responsibility of the states.
Ipaye said it was not government?s intention to impose any other consumption tax alongside VAT but that the funds were needed to improve infrastructure and boost tourism.
``The bill seeks to take hotel and tourism out of the regime of the state?s sales taxation law which has not been reviewed since 1982,'' he explained.
Other stakeholders and members of the public were given two weeks to make their contributions.
