By Amos Aar
IN RECENT weeks, the Benue State Government has intensified efforts to enforce compliance with business registration and tax obligations, leading to the sealing of numerous business premises across major towns in the state.
This initiative, spearheaded by the Benue State Internal Revenue Service (BIRS) in collaboration with the Ministry of Industry, Trade, and Investment, aims to bolster the state’s Internally Generated Revenue (IGR) by ensuring compliance to extant regulatory frameworks.
The primary catalyst for this crackdown is the widespread non-compliance among businesses concerning mandatory registrations and tax remittances.
Information by the government indicate that over 20,000 businesses in Benue State have failed to register their operations as required by law. The Commissioner for Industry, Trade, and Investment, Manasseh Orpin Alumo, emphasised the state’s commitment to enforcing compliance to enhance revenue and maintain regulatory standards.
It is equally important that operations of this nature are measured against prevailing political dynamics so as not to be easily blackmailed as the case has been. In other words, there is the need to be intentionally strategic by adopting a consciously collaborative approach – with emphasis on dialogue, empathy and support for businesses to achieve their goals as they are expected to meet their obligations.
Specific instances of non-compliance have been highlighted, such as the sealing of the Jos Electricity Distribution Company’s administrative headquarters and its Makurdi zonal office due to failure to renew business premises registration. Additionally, establishments like Balcony, City Bay Park and Benysta Microfinance Bank, all in Makurdi as well as Joy FM, Access Bank, among others in Otukpo, were sealed for non-payment of registration fees.
While the government’s actions are rooted in legal and fiscal responsibilities, the immediate economic implications are multifaceted.
Revenue generation for the state – by enforcing compliance, the state anticipates an increase in internally generated revenue, which is crucial for funding public services and infrastructure development.
Operational disruptions: the sealing of business premises, however, lead to temporary halts in operations, affecting revenue streams for the businesses involved and potentially leading to losses, especially for those with perishable goods or time-sensitive services.
Investor confidence – consistent enforcement of regulations can have dual effects on investor confidence. While on one hand, it assures potential investors of a regulated and orderly business environment; on the other hand, perceived aggressive enforcement without adhering to established standards or adequate engagement with business owners might deter prospective investors.
Employment concerns: Closure of businesses, even temporarily, can lead to workforce layoffs or unpaid periods, affecting the livelihoods of employees and contributing to economic instability for families that depend on these incomes.
The enforcement actions have elicited varied responses from stakeholders. Some business owners have expressed concerns over the abrupt nature of the closures.
For instance, Asema Achado, a member of the House of Representatives and owner of City Bay Park, described the sealing of his establishments as “unlawful” and “politically-motivated,” despite claims of having settled the demanded fees.
Conversely, the BIRS has maintained that the enforcement exercises are devoid of political undertones, but strictly in line with legal provisions. BIRS’ acting Executive Chairman, Sunday Odagba, responding to claims of political witch-hunt, stated that all affected businesses were duly served demand notices but the failed to comply, necessitating the enforcement actions.
The tax drive exercise by both the Ministry of Industry, Trade, and Investment and the BIRS, which ultimately end in sealing of business premises, is a delicate balance between regulatory enforcement and economic or existential necessity, either of which certainly has implications.
While the drive, meant to enhance revenue by ensuring rigid compliance, is commendable; however, it is imperative to approach the enforcement in accordance with the professional code or standard practice, just as it is also logical to be sensitive to the operational challenges that businesses face.
It is equally important that operations of this nature are measured against prevailing political dynamics so as not to be easily blackmailed as the case has been. In other words, there is the need to be intentionally strategic by adopting a consciously collaborative approach – with emphasis on dialogue, empathy and support for businesses to achieve their goals as they are expected to meet their obligations.
In the end, a combination of all these will ultimately foster a tensionless, deliberately friendly and conducive environment for economic growth and stability in the state.
