Ican 2022 Taxation Question 3

The Federal Government of Nigeria expanded the taxes and levies which the tiers of government can impose through the Schedule to the Taxes and Levies (Approved List for Collection) Act (Amendment) Order, 2015. In this Order made by the Minister of Finance, several new tax/levy heads, such as infrastructure maintenance/development levy, wharf landing charge/fee, consumption tax, the National information technology development levy, etc., were introduced. However, on May 8, 2020, the Federal High Court sitting in Lagos, delivered judgment in suit number: FHC/L/CS/1082/2019 between The Registered Trustees of Hotel Owners and Managers Association of Lagos (suing for itself and on behalf of all its members) Vs The Attorney – General of the Federation and Others, and held that the Ministerial Order of 2015 is unconstitutional, null and void. The Court submitted that the Constitution vests the legislature with the power to make laws. The Court further stated that schedules to a law are part and parcel of that law and as such, only the legislature can amend schedules to a law. The implication of this ruling is that all the taxes that were added to those ones in the Taxes and Levies (Approved List for Collection) Act Cap. T2 LFN 2004, via the Ministerial Order 2015, are illegal and cannot be enforced. Since the judgment, your firm has been faced with series of enquires from taxpayers on the taxes/levies they are now expected to pay.