By Ghazali Ibrahim
The Lagos State Internal Revenue Service (LIRS) has denied reports that it plans to seize money directly from people’s bank accounts or the accounts of defaulting companies to recover unpaid taxes, saying the claims misrepresent how the new tax enforcement rules will be applied.
In an interview on Arise News Channel, LIRS Executive Chairman Dr. Ayodele Subair clarified that the agency is not in a hurry to enforce the so-called Power of Substitution under the Nigeria Tax Administration Act, 2025, and has no intention of arbitrarily debiting bank accounts.
He said the public notice issued by the agency was meant to explain the provisions of the law, not to signal immediate or sweeping action against taxpayers.
“The notice really is just to continue that enlightenment and for people to know that this is a position of the law,” Subair said, adding that LIRS’ priority is to encourage voluntary compliance from taxpayers who owe taxes, not to rush into enforcement measures.
Subair stressed that organisations and individuals have the right to contest any tax assessment, and that enforcement actions will only apply after normal legal channels are exhausted.
“We are not policymakers. We don’t write the laws. What we do is enforce the laws,” he said, noting that the agency is focused on educating the public about their obligations.
Earlier this week, LIRS issued a public notice explaining that Section 60 of the NTAA 2025 allows a tax authority to direct a third party such as a bank, employer, tenant or business partner to remit funds belonging to a tax defaulter.
The intention of that rule is to improve collection efficiency when a tax liability has been formally established and confirmed, not to take funds without due process.
Authorities including the Presidential Fiscal Policy and Tax Reforms Committee have also emphasised that the Power of Substitution is a last-resort mechanism and not a routine action, noting that legal and administrative steps including court processes must be completed before it is invoked.
The clarification comes amid widespread public concern and online discussion about the implications of Nigeria’s evolving tax laws, with many Nigerians questioning how these powers might affect everyday banking and business transactions.
Overall, LIRS has urged taxpayers to understand their rights and responsibilities, stressing that the agency’s enforcement posture is measured and grounded in due legal process, with voluntary compliance preferred over compulsory action.
