On 15 February 2019, the Federal Inland Revenue Service (FIRS), in a letter, directed banks in Nigeria to suspend the lien placed on the bank accounts of alleged non-compliant taxpayers for a period of 30 days with immediate effect.
Recall that the FIRS had recently directed banks to place a lien on the bank accounts of a number of taxpayers for alleged non-payment of taxes. This exercise had resulted in hardships for many businesses, including some tax compliant businesses, within the period.
According to the letter written by the FIRS, the suspension of the lien is due to the large numbers of taxpayers visiting FIRS offices for reconciliation and the resulting inconvenience.
Implication
Based on the letter written by the FIRS, taxpayers whose bank accounts were previously frozen pursuant to FIRS' directive would now be able to access their accounts for a period of 30 days.
Notwithstanding the controversies regarding the powers of the FIRS to freeze taxpayers' bank accounts and the silence on whether such bank accounts would be frozen after the suspension, affected taxpayers should take advantage of the next 30 days to resolve their outstanding tax issues relating to pending assessments. They are also advised to engage their consultants and regularize their tax positions to avoid similar hardships on their businesses after the said period.
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