The Lagos State Internal Revenue Service (LIRS) has shut down Shoprite’s main store, one of the busiest supermarkets in Nigeria, due to claims of not complying with tax laws. This is more than just a fine. LIRS is using a strong approach, and this situation has an interesting and complex background.
The notice plastered on the entrance is specific, and it’s serious. It reads:
“This premises has failed to comply with its tax obligations… This is a contravention punishable by both financial penalties and imprisonment under Section 94 of the Personal Income Tax Act, 2011 (as amended).”
This is the most important part. Innovation Village’s research shows this issue isn’t about Company Income Tax, which is a federal matter. The key point is the Personal Income Tax Act (PITA), especially Section 94. This law requires companies to deduct tax from their employees’ salaries and send that money to the government.
The notice isn’t just saying that Shoprite hasn’t paid its taxes. It’s saying that Shoprite has not sent the taxes it has already deducted from its employees’ pay. That’s a much more serious claim.
The Real Story: A Landlord-Tenant Twist
This story takes an interesting turn. Initial reports, like the one from Nairametrics, were unclear on a crucial detail: was the Lagos State government sealing Shoprite, the tenant, or the entire mall, which is the landlord’s property?
We looked further into it and found an important detail. In 2021, the South African Shoprite Group sold its entire business in Nigeria to Ketron Investment Limited.
Recall that in 2021, the South African Shoprite Group sold its entire Nigerian operation. The buyer was a company called Ketron Investment Limited. Who owns Ketron Investment Limited? A property company called Persianas Investment Limited. And who owns Persianas Investment Limited and The Palms Shopping Mall? Mr. Tayo Amusan.
Think about that for a moment.
The Lagos State government sealed the door of the tenant, Shoprite, which is inside the landlord’s building, The Palms. The same person owns both. This is not a complicated three-way dispute. This is a direct and vital conflict between the Lagos State government and one of the largest retail and property companies in the country.
Why This Isn’t Just a Warning
LIRS doesn’t just shut down a big business for fun. This is the last step in a long process. It’s a serious action meant to achieve two things:
- Force Compliance: You might ignore letters and legal notices, but you can’t ignore a physical chain on your door that is costing you millions in sales every hour.
- Publicly Shame: This serves as a warning. The notice talks about fines and even mentions “imprisonment.” By referring to Section 94, LIRS is telling company directors that they are personally responsible.
This action aims to reach the owners directly and get them to pay quickly.
Right now, this is an ongoing story. Neither LIRS nor Shoprite’s management (Ketron) is making comments, which is common in situations like this. But the message on the door is very clear, and that’s what matters in Lagos.
