According to the new law, the definition of hotel means motel, short-term rental apartments; event centres, auditoria, open spaces, among others; while restaurants are eateries. Operators of traditional and customary eating places popularly called ‘bukas’ are, however, exempt from the law. Section 1 of the new law imposes the tax on anyone who consumes goods and services in hotels, event centres, and restaurants. In order to avoid double taxation, the hotels, event centres, and restaurants affected by the law are exempted from paying sales tax in the state. Consequently hotels, event centres and restaurants within Lagos state had been given one month to register with the state’s Internal Revenue Service, for the commencement of the payment of the tax.

Justifying the new tax, Lagos State governor, Babatunde Fashola, said the highest income tax in Lagos was 25 percent, while other cities around the world charged an average of 43 per cent on income tax. Consumers are already paying 10 percent service charge and 5 percent value added tax (VAT) in most hotels and eateries. This new tax regime is already unpopular amongst operators and consumers alike and from the look of things it will definitely curtail the booming restaurant [popularly called fast food] business in Lagos and in Nigeria generally

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