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The Lagos State Internal Revenue Service (LIRS) announced on Friday that it shut down 16 companies in the state for non-payment of consumption tax, worth about N126.19 million. According to Seyi Alade, Director of Legal Services at LIRS, the companies had not filed their consumption tax returns from 2014 to 2016.

Alade who spoke with News Agency of Nigeria (NAN) during LIRS’ state-wide tax law enforcement exercise said the companies were audited for the period but had failed to make remittances to the state government.

“The affected companies failed to pay the established liabilities despite the long period of time the agency gave them to regularise their tax status," said Alade, adding that the companies are prohibited from operating until they pay the taxes they owe.

The LIRS' Director said a demand notice, which has a 30-day expiry period, and a letter of intention, which expires after seven days, had been sent to the businesses. However, they failed to make payment before the agency's enforcement team were sent out to implement the shutdown.

“Before LIRS embarks on such exercise, it must have sent at least two letter of notices to the management of the affected firms reminding them of their tax liabilities," said Alade.

However, one of the affected companies, Tyttlo Event Centre, claimed it did not receive any demand notice from LIRS, according to its Business Development Manager, Damola Falola, who spoke to NAN. The company said it plans to meet with LIRS soon for reconciliation and payment.

The LIRS also urged taxpayers in Lagos to make prompt payment of their taxes to avoid disruptions to their operations and paying penalties. According to Alade, four of the companies that admitted their tax liabilities made their payments with additional payment of N100,000 each as distress cost to LIRS.

According to the Director, the LIRS has made tax compliance very easy for taxpayers. The agency recently launched the Electronic Tax Platform for individuals and companies to easily file their tax returns.