Welcome to Tax Education & Awareness Centre

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Are there penalties/sanctions for defaulters?

There are stipulated sanctions and penalties enshrined in the Law for defaulters. This ranges from a fine up to the sum of N2 million naira, a jail term of up to 6 months or both depending on the gravity of the default. The tax authority (EIRS) is also empowered by Law to effect the BOJ principle in respect of defaulting operators.

At what point is the tax collected?

The tax is collected at the point where a consumer makes payment for any service rendered or facility used in hotels, event centres, fast food joints, restaurants, eateries.

How does the collecting agent make remittance?

Collecting Agents are expected to make remittances into dedicated Internally Generated Revenue accounts of Edo State Government in the designated Banks. 

How is the Consumption Tax different from VAT?

The Consumption Tax is an Edo State Government tax to be paid by any individual/group on services enjoyed/facility used in any of the outfits covered by the Law; while the Value Added Tax is a Federal tax imposed on certain goods/services.

What constitutes a default?

A default is said to have occurred when a collecting agent fails to register or make returns and/ or fails to remit the taxes collected within the time allowed by law.

What does BOJ mean?

BOJ is an acronym for “Best of Judgement”. This is a principle that will be applied by the tax authority in the assessment of the tax liability of a defaulting operator. This implies that the tax authority has the mandate to make an estimation of the tax liability of an operator in the event of the operator withholding full disclosure in services offered or facilities operated.

What is the Law meant to achieve?

The law is meant to generate revenue for rapid social and economic development of Edo State and also act as a catalyst for the growth of the hospitality/tourism industry

What is the name of the Law?

Hotel and Event Centers Occupancy and Restaurant Consumption Law of Edo State, 2011.

What is the rate of tax?

The rate of the consumption tax is a 5% charge on the cost  of any service enjoyed or facility used in any of the identified outlets.

What is the tax to be paid on?

The tax is to be paid on any service rendered and facilities used in the hotels, event centers, fast food joints, restaurants, eateries etc.

What outfits are covered by the Law?

Hotels, Guest Houses, Events Centers, Fast Food Joints, Restaurants, Eateries.

When are collecting Agents expected to make remittance?

The respective collecting agents are expected to make remittances on or before the 7th day succeeding the month of collection.

When did the Law become fully operational?

The Law came into effect on the 30th of June, 2011. However, effective implementation commenced on the 1st of September, 2011.

Who collects the tax?

Operators of Hotels, Guest Houses, Event Centres, Fast Food Joints, Restaurants, Eateries.

Who pays the tax?

Those who patronize and use the facilities of Hotels, Guest Houses, Event Centres, Fast Food Joints, Restaurants, Eateries.