Multiple taxations pushing businesses to the brink

Business owners in the Federal Capital Territory (FCT) have raised alarm over what they described as multiple taxations and aggressive revenue enforcement by the Abuja Municipal Area Council (AMAC) and the Federal Capital Territory Administration (FCTA), saying the trend is crippling operations and wiping out profits. From small roadside operators to established firms, findings show […]

Business owners in the Federal Capital Territory (FCT) have raised alarm over what they described as multiple taxations and aggressive revenue enforcement by the Abuja Municipal Area Council (AMAC) and the Federal Capital Territory Administration (FCTA), saying the trend is crippling operations and wiping out profits.

From small roadside operators to established firms, findings show that many businesses are subjected to overlapping levies, inconsistent charges and, in some cases, coercive collection methods.

A POS operator in Wuse area of the territory, John Praise, said he pays different levies to different bodies with little clarity or coordination.

“I pay AMAC yearly, over N10,000, and they give receipts,” he said. “But tax force people still come every week and collect N2, 000. Then FCTA came last month and collected N7,000.”

He added that the weekly collections alone significantly impact his earnings.

“Every week they come, Friday and Saturday, and you must pay. If you don’t, they can seize your machine. That was why I paid when FCTA came, because they almost carried my POS.”

He noted that the cumulative burden is heavy.

“When you calculate everything, I spend close to N200,000 yearly on these taxes. Sometimes you work the whole day and you will not even see your gain,” he said.

Praise explained that most of the payments, aside from AMAC, come without documentation.

“It is only AMAC that gives receipts. Others, no receipts at all.”

He added that the enforcement process often disrupts business.

An Abuja-based media organisation has also raised alarm over what it described as double taxation by the Federal Capital Territory Administration (FCTA) through the Public Health Department of Health and Human Services Secretariat.

The company’s legal adviser who spoke on the development, said the company recently received court processes served at a short notice by FCTA authorities demanding to pay same taxes which the company had earlier paid to the Abuja Municipal Area Council (AMAC), the body statutorily empowered to do so, thus, amounting to double taxation.

“The process alleged non-compliance by the company with provisions of the National Environmental Health Practice Regulation, 2024 (NEHPR), including, failure to obtain a Health Status Report of the Company’s premises; failure to obtain a Certificate of Fitness for Use (CFU) or Certificate of Fitness for Continued Use (CFCU); failure to conduct mandatory pre-employment and periodic medical examinations for staff; failure to provide an Annual Occupational Health Audit Report; and failure to provide a Noise Pollution Assessment/Compliance Certificate.

“Our complaint is that we have made the same payments to AMAC, who are statutorily empowered to collect levies and dues as the Area Council, therefore, paying the same to FCTA amounts to double taxation and intimidation through their acts of illegally sealing-off premises of companies causing embarrassment,” he said.

Abuja Metro reports that both the FCTA and AMAC possess overlapping constitutional mandates for revenue collection, which has historically caused jurisdictional conflicts.

However, the legal consensus is that their mandates are delineated by specific types of taxes and the Taxes and Levies (Approved List for Collection) Act.

Under the 1999 Constitution (Fourth Schedule) and the Taxes and Levies Act, Area Councils (like AMAC) are constitutionally empowered to collect specific local taxes and rates, most notably tenement rates, market/trading licenses, and signage fees, among others.

On the other hand, the FCTA (acting through FCT-IRS or its Department of Outdoor Advertisement and Signage – DOAS) holds the power to collect taxes equivalent to state government taxes, such as personal income tax (PAYE), withholding tax, and corporate taxes.

Meanwhile, residents of the FCT have continued to face the heavy burden of double taxations from the FCTA and AMAC as officials from both authorities harass businesses and organisations to pay for the same levies and charges.

A POS operator, Abdulqoyum Amoo, said the lack of clarity around the charges by FCTA and AMAC remain a major concern.

“AMAC collects annually, sometimes N12,000, N15,000 or N18,000, depending on what they bring. Then, another group comes monthly to collect about N2,000, but we don’t even know what the money is for.”

He added that enforcement teams often operate without coordination.

“They will tell you they are different bodies. Even environmental people can come three times in a day and you will pay each time,” he said.

Amoo noted that business owners are forced to comply to avoid disruption.

In Karu, an estate surveyor, Moses Oke, said the situation has escalated beyond small businesses, affecting larger operations with significant financial implications.

“There are multiple taxations everywhere; the Abuja Municipal Area Council will charge you, then FCTA will come and duplicate the same charges.”

He added that some charges appear arbitrary and negotiable.

“I was charged N800,000 for continuous use. After questioning it, it was reduced to N400,000. So how did they arrive at the initial amount?”

Oke noted that the lack of standardisation creates uncertainty for businesses.

“They just give you bills at any time and you start negotiating. You cannot even say this is what you pay in a year.”

He explained that the pressure is forcing businesses to cut costs.

“When revenue is not enough and the government keeps increasing charges, you have to reduce staff,” he said. “You cannot keep people you cannot pay.”

Also speaking, Sunday Oguche, a manager at a car stand in Jahi, said recent demands from the FCT Inland Revenue Service have worsened the situation.

“We pay AMAC annually, but now FCT is asking for our account statements for three years to calculate tax,” he said. “Some people are paying up to N2 million.”

He added that the method of assessment is problematic.

“They calculate based on total inflow into your account, not profit,” he said. “That is not how business works.”

Oguche noted that the cumulative effect of taxes and levies is pushing businesses to the brink.

“On estimate, we spend about N2.2 million yearly on taxes and levies,” he said. “And you still have federal taxes on top of that.”

He explained that the burden is passed on to consumers.

“You add everything to the price,” he said. “If not, the business will suffer.”

He added that the pressure is forcing many operators out of the sector.

He called for harmonisation of taxes and better coordination between agencies.

Salim Muhammad, a fish farmer and retailer in Kubwa, said the constant stream of levies from different authorities is eating deep into his already tight margins.

He added that the irregular collections make it difficult to plan his business.

Muhammad noted that the pressure affects the daily running of his fish business.

“This business needs constant money for feeding and maintenance, but these payments keep cutting into it,” he said. “At the end of the day, you might not even see profit.”

He explained that enforcement is often aggressive.

“If you don’t cooperate, they start threatening to seize things or disturb your shop,” he said. “So you just pay to avoid problems.”

AMAC faults FCTA over environmental levy collection, alleges double taxation

Meanwhile, the Abuja Municipal Area Council (AMAC) has accused the Federal Capital Territory Administration (FCTA) Public Health Department of imposing what it described as double taxation on businesses through the collection of environmental-related levies already paid to the council.

An official of AMAC’s Environmental Services Department, Nasiru Alewa, who spoke during a telephone conversation, maintained that the statutory responsibility for collecting such levies rests with local government councils under the Fourth Schedule of the 1999 Constitution.

The official said businesses had raised concerns over repeated demands from the FCTA Public Health Department for payments relating to environmental compliance, including certificate of fitness, occupational health audit, and mandatory staff medical examinations, despite already paying similar charges to AMAC.

According to him, “The right to collect this levy or regulation belongs to AMAC, not Public Health. If you check the Fourth Schedule of the 1999 Constitution, you will discover that these functions are the statutory responsibility of local government councils.”

He alleged that the dispute stemmed from the activities of a former consultant disengaged by AMAC, who he claimed later aligned with the FCTA Public Health Department after his contract with the council was terminated.

The AMAC official alleged that the consultant had continued enforcement activities in the territory with the backing of the FCTA agency, leading to confusion among business owners.

“When they disengaged him because of complaints from businesses, he went to FCDA and entered into an agreement with Public Health. Since then, he has continued to terrorise people in the FCT,” he claimed.

The official further disclosed that the matter had attracted the attention of the National Assembly, which he said had invited the agencies involved to resolve the dispute.

He advised businesses that had already paid environmental levies to AMAC not to make fresh payments to the FCTA Public Health Department.

“If you have paid to AMAC and have your receipt, hold on to it. You are not supposed to pay again because it amounts to double taxation,” he said.

He added that some magistrate courts had reportedly ruled against repeated payments where evidence of prior payment was presented.

The official expressed optimism that the inter-agency dispute would be resolved before the end of the year, enabling businesses to know the appropriate authority responsible for the levy collection.

When contacted, Special Assistant on Media to the Mandate Secretary of the FCTA Health Services and Environment Secretariat, Mrs Bola Ajao, promised to get back to our reporter but was yet to do so as of the time of going to press.