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Multiple taxation: Forum says Abuja hotels may close down

The Hotel Owners Forum in Abuja (HOFA) has said that consistent multiple taxation on hotels in the Federal Capital Territory (FCT) could force them out of business.

Dr. Chike Ezeudeh, the President of HOFA, made the observation in an interview, on Thursday, in Abuja.

“ It is not easy when you have a business and you are confronted with over 25 different taxes to pay, with some of them as high as N500,000.

“The names of some of the taxes are so funny; they have what is called Bicycle and Cart levies, which is over N250,000.

“They also have `parking tax’, which is between N250,000 and N500,000; this is so frustrating.

“Most hotels cannot pay these taxes, and if they try to pay such, they will be out of business; no hotel business can survive after paying all these bills.

“The worst of it is that Abuja Metropolitan Area Council (AMAC) in the name of enforcing tax payment, will come with police and seal the hotels while international guests and others are in their rooms.’’

He said that such development was not good for the image of the hospitality industry in particular and the country in general.

“The enforcement strategy is crude; there is always a better way of doing things without inflicting hardship that will make business owners to close shop.’’

Ezeudeh said the forum comprised law-abiding members, adding that it would not prevent the government from generating its revenue.

The HOFA chief said, however, that such revenue generation should be done with human face.

According to him, it is unfortunate that AMAC alone has many levies and bills; but that hotel operators also need to survive in this harsh economy.

Ezeudeh said the new leadership of HOFA had started negotiating with the appropriate authorities.

The president said he had met with the Minister of the FCT, Malam Muhammad Bello, seeking the reduction and harmonisation of the numerous taxes, to allow hotel operators pay with ease.

“The minister is a kind person; he understands the plight of business owners in Abuja and promised to look into the issues.

“The truth is that when taxes are high, business owners may not be able to pay, and some unpatriotic officials will like to take bribe and write off some levies.

“There should be reduction and harmonisation of the taxes for hotel operators.

“If done, they will pay and not retrench their workers; this will boost the economy of the country,’’ Ezeudeh said.

The taxes and levies being paid by hotels owners in Abuja are entertainment, tenement, business premises and local council.

Others are billboard, Radio Permit, Federal Inland Revenue Service, Fire Service and many others. (NAN)


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1 Comment

  1. Azzo 18th May 2017 at 1:23 pm

    The last time I was in Abuja, I posted a comment on this and other medium regarding the advise I read in one of the dailies given by the Nigerian Institution of Estate Surveyors and Valuers (NIESV) at their 46th Annual Conference in Abuja where the FCT was advised to tax heavily all the thousands of newly built but very many years un-let residential properties dotted round the Federal Territory. Instead of taking that advise and generate income either through tax or making these residential properties rented what they have resorted to is to trouble hotel investors in Abuja. I understand that the Minister did not attend the conference even when crucial property tax, development and management matters where discussed at the event in his domain.

    But that does not surprise me as I am also unclear the functions of NIESV in the land. They have no clout nor actual presence in their field and areas of specialisation. They are an unwilling party in participating politically, socially and economically on matters that concern real estate development and management in the land even when this task is solely ascribed to them under the Land Use ACT 1978. This much is true as we can see how very poorly they are represented in the hallowed chambers of the National Assembly where all property matters, including laws, policies and key real estate decisions are left to senators from other disciplines. Perhaps for this reason too, Abuja hoteliers do not know to use the expertise of members of the institution when faced with real estate tax and other related property matters.

    The concern with this action by the FCT is that it is very capable of igniting ethnic bias for one simple reason – Is it not very obvious what is happening in this matter? Is it not true that approximately 90- 95% of hotels in Abuja are owned by Igbos? We have never had an Igbo man as the FCT minister since it was created even as the nation’s capital. It is not also difficult to read between the lines that there can not be one anytime soon.

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