Lagos to Challenge Court Order Suspending Consumption Tax Law
Appoints Lawal Pedro to lead its legal team
Gboyega Akinsanmi
The Lagos State Government has rejected an injunction by a Federal High Court sitting in Ikoyi which temporarily restrained it from enforcing the provisions of the 2017 Hotel Occupancy and Restaurant (Fiscalisation) Regulations 2017.
Consequently, the state government has equally appointed the immediate past Solicitor General of the state, Mr. Lawal Pedro (SAN), to lead its legal team to challenge the order suspending the fiscalisation regulation until the suit is concluded.
A legal source disclosed the plan at a session with select journalists recently, lamenting that the order was an affront to a Supreme Court decision that validated the Hotel Occupancy and Restaurant Consumption Law, 2009
In a ruling he delivered penultimate week, Justice Rilwan Aikawa had suspended the fiscalisation regulation until the substantive suit filed by the Association of the Registered Trustees Hotel Owners and Managers Association of Lagos was determined.
The judge equally suspended the Hotel Occupancy and Restaurant Consumption Law Cap H8, Laws of Lagos State 2015 while restraining the state government from enforcing or implementing it in some parts of the the state.
But at a session with journalists recently, the legal officer said the state government “is aware of an ex-parte injunction granted by the Federal High Court Lagos on March 21 in respect of the new regulations the state government issued pursuant to the Hotel Occupancy and Restaurant Consumption Law.”
Specifically, the court noted that the lower court delivered the injunction without taking congisance of the decision of the apex court that validated the legality of the Hotel Occupancy and Restaurant Consumption Law in 2013.
He added that it was unfortunate that former Attorney-General of the state, Mr. Olasupo Shasore (SAN), could take up a legal battle against a legislation that the state House of Assembly validly enacted under his supervision.
He lamented that the ex-parte order was obtained by Shasore, a former Attorney-General and Commissioner for Justice under whose supervision the Hotel Occupancy and Restaurant Consumption Tax Law, 2009 was enacted.
He said Shasore “was theAttorneyGeneral and Commissioner for Justice when the Hotel Occupancy and Restaurant Consumption bill was passed into Law by the Lagos State House of Assembly and its inclusion in the laws of the State was done while Shasore was the Chairman of the Law Reform Commission.”
After its passage, the Lagos State House of Assembly had also approved a regulation, Hotel Occupancy and Restaurant Consumption (fiscalisation) Regulations, 2017 “to ensure that all consumption Taxes charged by Hotel and Restaurant owners on citizens are duly captured and remitted to the state government.
He explained that the fiscalisation regulation was initiated essentially “to ensure transparency and accountability in the collection of consumption tax in Lagos State. The regulation does not in any way increase the burden of hotel owners.
“The state government will challenge the interim orders obtained by misrepresentation of fact and pursue the substantive suit until its dismissal. Since 2009 when the law was enacted, there had been compliance by hotel and restaurant owners.”
He noted that the hotel and restaurant owners kicked against the regulation because the state government had resolve “to ensure transparency and accountability in collection of consumption tax that led to the institution of the frivolous suit.”
Already, he said, the state government had put its legal team together “to challenge the injunction of the federal high court. Pedro, former Solicitor General of Lagos State, has been engaged to lead the legal team to contest the suit.
In an e-mail he sent to journalists, Shasore said the Hotel Occupancy and Restaurant Consumption Law was enacted by the Lagos State House of Assembly and came into force on June 22, 2009, when he was the Attorney General of Lagos State.
He explained that he “is a counsel and not plaintiff in the present suit predicated on the recent decision of the Supreme Court in Attorney General of Lagos State v Eko Hotels Limited and Anor.
Shasore said the apex court held that the VAT Act, an Act of the National Assembly “has covered the field on the issue of Sales Tax and other such taxes in Nigeria including the consumption tax that the Hotel Occupancy and Restaurant Consumption Law sought to introduce.