The Federal Capital Territory Administration (FCTA) has secretly introduced a five percent consumption tax in Abuja.
This brings to 12.5 percent of consumption tax that consumers pay whenever they pick up items in restaurants, bars, clubs and hotels in the Nigerian capital.
Reports said that restaurants, eateries, fast food joints are charging a 5 percent consumption tax on food, drinks and other consumables in restaurants, hotels, eateries and others in Abuja.
Several fun seekers and Abuja residents who besieged the eateries during the Yuletide were alarmed to discover that the operators were imposing 12.5 percent tax of total items bought.
The restaurants operators are claiming that the tax which they termed ‘entertainment tax’ was approved by the FCT administration.
While many were alarmed at the imposition of what they consider a secret tax, they grudgingly picked their bills and left.
An official at the FCT Internally Revenue Service confirmed the imposition of the new tax.
The source, who did not want to be named, argued that while the tax is being newly imposed, the law has been in existen
The source stressed the FCT IRS authorized the payment of the new tax described as “entertainment law.”
The source said: “Actually, the law has always been there. Entertainment Tax is what we call that law. We charge 5 percent on consumption on hotels and restaurants and what have you. It goes to the consumers. We have not been implementing it. We just started implementing it of recent.
“Even recently, to be precise, we had a press conference last week where the chairman spoke about it. We have started the campaign to educate people about it. So they are actually right.
“It is not all the restaurants, we classified the restaurants. We are talking about the hotels and restaurants.
“We are actually implementing entertainment tax. The FCT IRS is collecting mandated to implement it,” the source said
Head of FCT-IRS Corporate Communications, Mustapha Sumaila, could not be reached for comments.