The Federal Capital Administration (FCTA) has introduced a five per cent consumption tax in Abuja.
This brings to 12.5 per cent of the consumption tax that consumers pay whenever they pick up items in restaurants, bars, clubs, and hotels in the nation’s capital.
It was gathered that restaurants, eateries, and fast food joints are charging a 5 per cent consumption tax on food, drinks, and other consumables in restaurants, hotels, eateries, and others in Abuja.
Many fun seekers and residents who besieged the eateries were alarmed to discover that the operators were imposing 12.5 per cent tax of the total items bought.
The restaurant operators are claiming that the tax which they termed ‘entertainment tax’ was approved by the FCTA.
While many were alarmed at the shocking imposition of what they consider a secret tax, they grudgingly picked their bills and left.
A highly placed officer in the FCT Internally Revenue Service confirmed the imposition on the new tax on Friday, December 27, 2024.
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The source who craved anonymity said while the tax is being newly imposed, the law has been there for long.
The source disclosed that the FCT IRS authorised 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 per cent on consumption on hotels and restaurants. It goes to the consumers. We have not been implementing it. We just started implementing of recent.
“Even recently, to be precise, we had a press conference last week where the chairman spoke about it. We have started a 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.”
Efforts to speak with the Head of FCT-IRS Corporate Communications, Mustapha Sumaila, were unsuccessful as of press time.
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