Enugu Agency Faces Accusations of Illegally Shutting Down 50+ Hotels

Table of Contents

• Condemnation of Clampdown
• Legal Action Taken
• Concerns Over Double Taxation
• Government Reaction
• Impact on the Hospitality Industry
• Conclusion

Hotel owners in Enugu State condemned the alleged unlawful shutdown of their establishments by officials from the Enugu State Internal Revenue Service on Friday.

They spoke through the Incorporated Trustees of Coal City Hotel Owners Welfare Association (ITCCHOWA), alleging that over 50 hotels have been closed by the agency despite an ongoing court case.

According to their claims, the officials are justifying their actions based on Purchase Tax and other related fees.

Speaking to reporters about their situation, their attorney, Barr. Chijoke Ezeh, stated that they have filed a lawsuit at the Federal High Court in Enugu, seeking clarification on the relevant Nigerian laws concerning Value Added Tax (VAT) and Purchase Tax.

Ezeh emphasized that the case, numbered FHC/E/CS/308/2025, currently pending before the Federal High Court, should be resolved before the state government takes any actions, such as closing hotels.

He explained that the purpose of addressing the media was to clarify the situation in Enugu State regarding the hotel closures due to Purchase Tax.

The attorney argued that the Purchase Tax constitutes double taxation since VAT is also being collected from his clients.

He stated, “The main objective of this meeting is to clarify the recent events in Enugu State, specifically the closure of certain hotels by government authorities.”

“We are here to express the position of the Incorporated Trustees of Coal City Hotel Owners Welfare Association (ITCCHOWA) regarding this issue.”

“The matter at hand is that there has been a recent demand for the payment of Purchase Tax by the government, along with the land use charge.”

“We were instructed to approach the Federal High Court based on section 251 sub 1 paragraph E of the 1999 Constitution of the Federal Republic of Nigeria, which grants the Federal High Court exclusive jurisdiction over taxation matters.”

“Thus, we initiated a suit, numbered FHC/E/CS/308/2025, seeking an interpretation of the relevant legal provisions, particularly the VAT Act, which empowers the Federal Government to collect Purchase Tax through the Federal Inland Revenue Service.”

“There is also a law enacted by the Enugu State House of Assembly, known as the finance law, which grants the Enugu State Internal Revenue Service the authority to collect the same tax on consumables in the state, which we believe amounts to double taxation.”

“As a result, we decided to seek judicial interpretation of the relevant laws concerning Purchase Tax.”

“We have fulfilled this requirement, and the appropriate government authorities involved in the case have been served.”

Ezeh expressed astonishment that, despite being served, the ESIRS proceeded to close hotels.

He mentioned that the government claimed to be acting based on a supposed court order, “which we have not received.”

“As we speak, my clients have not received any court documents regarding that order.”

“We are not aware of any pending suit aside from the one we filed; no such suit has been served on them, and we maintain that our clients are law-abiding citizens who have never defaulted.”

“We have been paying all the levies and charges imposed by the state government. However, regarding Purchase Tax and ground rent, we have sought judicial clarification.”

“The appropriate course of action is to wait for the court's judgment. My clients have never claimed they would refuse to pay taxes; they have not done that and will not do so.”

“What we are asserting is that there is a lawsuit addressing legal questions, awaiting court interpretation, and any action taken before that is resolved would harm the plaintiffs' position in the suit.”

“I believe it is prudent for us to wait for the court to interpret the law,” he stated.

Also addressing the issue, the Chairman of the hotel owners, Dr. Johnson Ugwuoke, who was accompanied by other hotel owners, affirmed that their attorney had clearly articulated their concerns.

Ugwuoke highlighted that they are not opposed to taxes and levies but will not accept double taxation, which could hinder their growth.

“Our lawyer has effectively summarized our position and the reasons for our gathering.”

“We are investors in the state, and we have good intentions for the state. Hotel owners, alongside the state government, are the second-largest employers of labor. Our investments are vital.”

“We are law-abiding citizens and expect all our members to fulfill their tax obligations to the government, which most, if not all, have done; however, the recent introduction of Purchase Tax and its enforcement raises concerns.”

“We are making this known not only for public awareness but also to urge the government to address this situation.”

“Shutting down hotels with guests, visitors, and business people inside, locking them up, and chaining them is excessive.”

“We are here, our businesses are here, and we are not fleeing. If the court rules in favor of the government, we will comply and pay any back taxes owed.”

“We will find a way to settle our obligations, but we believe the current actions are unwarranted.”

“We are appealing to government authorities to reconsider this approach, as it is causing embarrassment to the state and its visitors,” Ugwuoke asserted.

At the time of publishing this report, attempts to obtain a response from the ESIRS were unsuccessful.