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Lagos digitises revenue collection from hotels, restaurants

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The Lagos State Internal Revenue Service (LIRS) has announced the immediate deployment of an electronic system for the collection of hotel occupancy and restaurants consumption tax (HORCT).

In a public notice on Monday, Ayodele Subair, executive chairman of LIRS, said the new collection process called the ‘eco fiscal system’ (EFS) is an automated invoicing solution, designed to revolutionise the collection of consumption taxes in the state.

He said the EFS evolution aligns with LIRS’ commitment to building convenience into the payment of taxes and easing compliance with tax laws.

“This technological advancement marks a significant leap in our continuous efforts to enhance revenue collection, streamline processes, and improve efficiency in tax administration,” he said.

“It simplifies compliance and improves accuracy.”

Traditionally, Subair said the HORCT collection has been a tedious task for operators in the past, even as the manual process often led to errors, penalties, and increased costs.

But with the “cutting-edge” software, businesses can now automate and digitise their invoicing and collection processes, he said.

“Built with operators in this sector in mind, EFS offers real-time online consumption tax billing, collection monitoring, and instant issuance of receipts with a unique invoice number,” the LIRS boss said.

“It also reduces compliance costs, facilitates easy administration and reconciliation for HORCT collections, and fosters transparency.”

Subair said by adopting the EFS, businesses can ensure accurate calculations, eliminating the risk of mistakes associated with manual data entry.

He said the system automatically applies relevant tax rates, saving businesses valuable time and resources.

The software, according to the taxman, also provides secure and efficient record-keeping, simplifying audits and minimising compliance risks.

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“Our goal is to empower businesses with innovative solutions that enhance their operational efficiency and minimize compliance challenges,” he said.

“Businesses can focus on their core operations, leaving the complex task of tax compliance to the reliable and automated system.”

Subair enjoined all operators in the hospitality sector to adopt the EFS.

He stressed that operations on the system take effect immediately and failure to comply is a contravention of the provisions in sections 7(1), 8, and 9 of the Hotel Occupancy and Restaurant Consumption Fiscalization Regulation 2017.

Subair also noted that the EFS is compatible with various e-commerce platforms and can seamlessly integrate with existing accounting systems, ensuring a smooth implementation process.

He added that LIRS officials would be visiting establishments in the hospitality industry, to integrate the software with existing systems and provide necessary assistance for a seamless transition to the EFS platform.

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Dangote Refinery Reduces Ex-Depot Petrol Price To N835/Litre

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By Abubakar Yunusa

The Dangote Petroleum Refinery has further reduced the ex-gantry price of premium motor spirit (PMS), also known as petrol, to N835 per litre.

According to sources at the refinery, the plant dropped the price of the petrol sold to oil marketers to N835 per litre, six days after the refinery reduced it to N865 per litre.

“The refinery reduced the price of the petrol to N835 per litre,” a source told TheCable.

The reduction in Dangote petrol price followed an announcement by the federal government on April 9, that the naira-for-crude oil deal will continue after the first phase ended on March 31.

“The stakeholders reaffirmed the government’s continued commitment to the full implementation of this strategic initiative, as directed by the Federal Executive Council (FEC),” the finance ministry said.

“Thus, the Crude and Refined Product Sales in Naira initiative is not a temporary or time-bound intervention, but a key policy directive designed to support sustainable local refining, bolster energy security, and reduce reliance on foreign exchange in the domestic petroleum market.”

On April 15, Farouk Ahmed, chief executive officer (CEO) of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), said the estimated pump price of petrol in Nigeria is less than that of neighbouring countries in West Africa.

Ahmed also said Nigeria’s petrol importation reduced by 29.9 million litres in eight months due to increased contributions from local refineries.

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Double-digit GDP growth necessary to achieve $1trn goal – UBA GMD

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Group Managing Director, United Bank for Africa (UBA), Mr Oliver Alawuba, has said Nigeria requires a double-digit Gross Domestic Product (GDP) growth to achieve the projected one-trillion dollar economy target by 2030.

Alawuba made this remark on Monday in Abuja, at the ongoing 36th Edition of the Finance Correspondents and Business Editors Association of Nigeria Seminar, organised by the Central Bank of Nigeria (CBN).

The theme of the seminar is, “Playing the Global Game: Banking Recapitalisation Towards a One- Trillion Dollar Economy”.

He emphasised the necessity of institutional frameworks and government support for banks to invest in critical infrastructure that would foster accelerated growth of the Nigerian economy.

“We need to grow at double digits to get to one-trillion dollar in 2030. We need 10 per cent growth, which is achievable,” he said.

He noted that only 12 per cent of Nigeria’s GDP is represented by the total assets of banks, while other economies have over 70 per cent to 100 per cent.

According to him, this indicates a significant gap where banks can intervene and help mobilise deposits, resources, and capital, ensuring that other sectors benefit from the banking system.

“The plan so far is highly beneficial for the economy. Strong banks require strong profits. Strong banks are crucial for building the strong economy we desire.

“It’s important that banks remain profitable so they can build a very robust reserve to support the economy and the banks themselves.

“The opportunities in Nigeria are immense. Therefore, sustainability will not be a problem.

“This is because banks will now be able to raise, even with the capitalisation we have undertaken, sufficient capital to truly elevate this economy to the next level,” the managing director added.

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Alawuba also said the 50 per cent Cash Reserve Ratio (CRR) might be unsustainable for economic growth and urged its reduction, just as inflation rate was managed.

He highlighted the importance of security, financial inclusion and addressing infrastructure deficits in roads, ports and power.

He further stressed the need for tax incentives and a transition from a primary to a secondary economy to drive growth.

“We need an institutional framework and government support to invest in infrastructure and other areas to support the economy.

“A 50 per cent CRR is not sustainable if we are going to talk about the growth of the economy.

“I am happy that inflation is responding to the actions of the CBN.

“So, as the inflation rate comes down, we expect the CRR to come down,” he said. (NAN)

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GenCos Ask FG, Stakeholders To Pay N4trn Electricity Debt

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The electricity power generation companies (GenCos) have warned that the over N4 trillion unpaid invoices owed by the federal government and stakeholders for electricity generated threatens their operations.

In a statement on Monday, signed by Sani Bello, chairman of board of trustees, Association of Power Generation Companies (APGC), the GenCos asked the federal government and key stakeholders to urgently address the issue.

According to the association, the issue is currently threatening the continued operation of their power generation plants.

“It is no more news that the power generation companies (GenCos) have continued to bear the brunt of the liquidity crisis in the Nigerian Electric Supply Industry (NESI),” the statement reads.

The association said they have made large-scale investments and have continued to demonstrate commitment by increasing capacities that align with their contract, spanning over 10 years.

The GenCos said expectations of being settled through external support such as “the World Bank PSRO has also been dampened due to other market participants’ inability to meet their respective distribution linked indicators (DLI), enshrined in the Power Sector Recovery Program (PSRP)”.

Moreso, they said the 2024 payment collection rate dropped below 30 percent, and “2025 is not any better, severely affecting GenCo’s ability to meet financial obligations”.

“Tax and Regulatory Challenges: High corporate income tax, concession fees, royalty charges, and new FRC compliance obligations are further straining GenCos’ revenue,” the GenCos said.

“Outstanding Payments: GenCos are currently owed about N4 trillion (N2 trillion for 2024 and N1.9 trillion in legacy debts). No possible solutions, including cash payments, financial instruments, and debt swaps, are in sight.

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“Budget Allocation Concerns: The 2025 government budget allocates only N900 billion, raising concerns about its adequacy to cover arrears and future payments.”

Furthermore, the group said that liquidity challenges are further worsened by the various policies introduced.

As a result of the policies, the association said “no one is under pressure to ensure GenCos invoices are fully settled”.

“The implication of this is that GenCos only get paid a portion of their invoices (9%, 11%) from whatever amount is left,” the association said.

The GenCos demanded immediate implementation of payment plans to settle all outstanding GenCos invoices.

“Reprioritization of payments under the waterfall arrangement to give full priority to a hundred percent payment of GenCos’ invoices as at when due. A clear financing plan to backstop the exposures in the NERC’s Supplementary Order to the MYTO and the DRO 2024,” the association said.

They also requested the provision of payment security backed by the World Bank and the African Development Bank (AfDB) to guarantee full payment to GenCos to enable them to meet their critical needs, ensuring adequate generation and expansion.

The GenCos urged the federal government to liberalise the market to create confidence and ensure the viability and creditworthiness of the power sector.

Also, the association demanded “full effectiveness of all market agreements, firm monitoring, and enforcement of the rules by the regulator on all market participants”.

In light of the severity of the issues, the GenCos requested that immediate action be taken to prevent national security challenges due to their failure to sustain Nigerians’ steady electricity generation.

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