Produce Sales Tax Law

1. Citation. This Law may be cited as the Produce Sales Tax Law.

2. Interpretation. In this Law, unless the context otherwise requires- "Board" means the State Tax Board established under the Income Tax Law; [WN 1 of 1961, Cap. 12.] "chargeable produce" means produce whose sale is subject to tax; "chargeable sale" means a sale subject to tax; "Governor" means the Governor of the Delta State of Nigeria; "licensed buying agent" means a buying agent in possession of a valid licence granted by the Marketing Board under the Delta Marketing Board Law; "marketed produce" means produce for the time being included in Part I of the Schedule; ? "Marketing Board" means the Delta Marketing Board established by the Delta Marketing Board Law; "prescribed", in relation to marketed produce: means prescribed by regulations made under section 11, and, in relation to other chargeable produce, prescribed by regulations made under section 29; "produce" means any product of agriculture, horticulture or sylviculture; "resale" includes resale outside the Delta State; "sale" means any contract which is a contract of sale within the meaning of the Sale of Goods Law, and also a contract similar to such contract in other respects but made for a consideration wholly or partly in money?s worth and not, or not only, in money, and includes any transaction, in whatsoever form expressed, in so far as its effect is in substance the same as the effect of such a contract as aforesaid, and reference to goods being bought includes, in relation to a purchase made for a consideration not, or not only in money, and in relation to any such transaction as aforesaid, references to goods being acquired in any manner; [Cap. S1.] "State" means the Delta State of Nigeria; "tax" means the produce sales tax imposed by or under this Law; "use" and "used" include the ordinary use of any produce specified in the Schedule to this Law for purpose of manufacture.

3. Produce sales tax imposed. A tax, to be called produce sales tax, shall be charged in the Delta State, subject to and in accordance with the provisions of this Law, on all chargeable sales of the produce mentioned in the first column of the Schedule at the rates specified in the second column of the Schedule.

4. Variation of tax. (1) The House of Assembly of the State may from time to time vary the provisions of the Schedule by resolution pissed by it ordering- (a) that tax shall cease to be chargeable in respect of sales of any produce in respect of which it is for the time being chargeable; or (b) that tax shall be chargeable in respect of sales of produce in respect of which it is not for the time being chargeable and that such produce shall be included in Part I or Part II of the Schedule as the case may be; or (c) that an increased or reduced rate of tax shall be substituted as the rate of tax in respect of the sale of any produce in respect of which it is for the time being chargeable; or (d) that any produce in respect of whose sales tax is for the time being chargeable shall, if chargeable under Part I of the Schedule, be chargeable under Part II thereof, or, if chargeable under Part II of the Schedule, be chargeable under Part I thereof. (2) A resolution passed by the House of Assembly of the State in exercise of the powers conferred by subsection (1) of this section shall be published in the State Gazette and shall have effect upon such publication or from such date after publication as may be specified in the resolution.

5. Provisions applicable to charge, collection and recovery of tax. (1) Tax imposed on sales of marketed produce in accordance with the provisions of this Part shall be charged, collected and recovered in accordance with the provisions of Part III. (2) Tax imposed on sales of produce, other than marketed produce, in accordance with the provisions of this Part shall be charged, collected and recovered in accordance with the provisions of Part IV.

6. Chargeable sales of marketed produce. (1) Every sale to the Marketing Board of marketed produce shall be a chargeable sale. (2) For the purposes of this section- (a) a sale of produce to a licensed buying agent shall be deemed to be a sale to the Marketing Board; (b) a resale to the Marketing Board by a licensed buying agent of produce deemed by paragraph (a) of this subsection to have been sold to the Marketing Board shall not be subject to tax.

7. Accountability for tax. The tax chargeable in respect of a chargeable sale to the Marketing Board shall be payable by the seller, shall be deemed to be due upon payment to him of the purchase price, and shall be collected in the manner provided in section 8.

8. Marketing board accountable for tax. (1) The price payable by or on behalf of the Marketing Board upon purchase from a seller under a chargeable sale shall be the price prescribed under the Delta Marketing Board Law, reduced by the amount of tax at the rate in force at the time of purchase. (2) The Marketing Board shall be accountable for the tax in respect of chargeable sales in the manner prescribed by regulations made under section 11.

9. Licensed buying agents to supply information. (1) A licensed buying agent shall furnish to the Marketing Board within such time and in such form as it may require such information relating to chargeable sales to such licensed buying agent as the Marketing Board may specify and shall, upon, demand by the Marketing Board, produce any bool$ or account relating thereto at such time and place as the Marketing Board may require. (2) A licensed buying agent who fails to comply with any requirement of the Marketing Board lawfully made under this section shall be liable to a penalty of one thousand naira. (3) A penalty incurred under subsection (2) of this section may be sued for, enforced and recovered by suit or other appropriate civil proceedings in a magistrate's court, which court is hereby invested with the necessary jurisdiction for the purpose, by the Attorney- General of the Delta State and all such proceedings shall be deemed to be civil proceedings and the ordinary civil procedure applying in such court shall apply thereto.

10. Offences. If any person- (a) in relation to any requirement of the Marketing Board under section 9 (1) knowingly furnishes any statement, information or report which is false in any material particular, or recklessly makes a statement which is false in any material particular; or (b) with intent to deceive, for the purpose of section 9, produces, furnishes or makes use of any book, account or other document which is false in a material particular, he shall be guilty of an offence and shall be liable on conviction to imprisonment for six months or to a fine of one thousand naira or to both such fine and imprisonment.

11. Power to make regulations. The Executive Council may make regulations for all or any of the following purposes- (a) for requiring the Marketing Board to make returns of the amounts of tax for which they are accountable, in respect of such period, in such form and containing particulars with respect to such matters as it may prescribe; (b) for requiring the Marketing Board to pay the amounts of tax appearing by the return to be due from them at such times as if may prescribe.

12. Chargeable sales and accountability. (1) The following shall be chargeable sales or deemed to be chargeable sales- (a) any produce specified in Part II of the Schedule, which is produced within the Delta State of Nigeria and exported from Nigeria by any person whomsoever; [No. 18 of 1966.] (b) produce specified in Part II of the Schedule, which is produced Within the Delta State of Nigeria and sold by any person whomsoever to manufacturers within Nigeria; (c) any produce specified in Part II of the Schedule, which is produced within the Delta State of Nigeria and used by the producers for the purpose of manufacture within Nigeria. (2) The tax shall be paid by- (a) the seller at the time of delivery of the produce sold; or (b) the person exporting the produce at the time of export of the produce; or (c) the person using the produce for purposes of manufacture within Nigeria at the time of appropriation or use of the produce for such manufacture within Nigeria. (3) The tax shall be collected, accounted for and remitted to the Board as follows- (a) in the case of produce exported outside Nigeria, in the manner prescribed by the Governor pursuant to any regulations made under section 29 of this Law; (b) in the case of produce sold to manufacturers within Nigeria, or produced and used by the manufacturers within Nigeria, by such manufacturers within such time and in such manner as may be prescribed in any regulations, made under this Law.

13. Registration of buyers of produce. (1) Subject to the provisions of this section, every person whose business includes the buying of any produce specified in Part II of the Schedule for the purposes of resale shall be registered as a buyer of that produce: [WN 1 of 1961.] Provided that a person shall not be required to be registered by reason of his carrying on such business if his annual gross takings from his sales of chargeable produce do not on the average exceed such sum as may be prescribed in respect of that produce or, in the case of a business recently commenced, are unlikely to do so. (2) Every person carrying on business in such circumstances that he is required under subsection (1) of this section to be registered under this Part shall make an application in the prescribed form to the Board to be registered- (a) if he is carrying on business at the date when the sale of any produce becomes chargeable by or under the provisions of this Law, within ninety days of that date; or (b) if he begins to carry on business in such circumstances that he is required to be registered or if the circumstances of a business carried on by him become such that he is required to be registered after the sale of any produce becomes chargeable by or under the provisions of this Law, within fourteen days of his commencing to carry on such business, or when the circumstances of his business becomes such as aforesaid, as the case may be. (3) The Board shall register every person who is required by this Part to be registered (whether or not application is made by such person) and shall, on his registration, issue to him a certificate thereof. (4) Where a person who is registered ceases to be required by this Part to be registered the Board shall cancel his registration. (5) The Board shall give notice to every person registered otherwise than in accordance with an application made by him and to every person whose registration is cancelled of such registration or cancellation, as the case may be.

14. Returns. Every person required by this Part to be registered shall make such return to the Board and keep such records as may be prescribed. [WN 1 of 1961.]

15. Secrecy. Returns made under this Law or any regulations shall be available only to the Board and persons authorised by it and for the purposes of this Law. [WN 1 of 1961.]

16. Determination of tax. (1) When a person accountable for tax, having bought chargeable produce to which this Part applies, fails to make a return or remittance as required by or under this Law, or if his returns are not substantiated by records, the Board may make an estimate of the amount of the tax collected by such person for which he has not accounted, and such estimated amount shall thereupon be deemed to be the tax collected by that person, and he shall pay that amount to the Government and the Board may give notice in writing either by post or by serving such person, his heirs, administrators, executors or assigns, requiring that such estimated amount shall be paid over to the Board or otherwise accounted for within thirty days from the date the notice is mailed or served. [WN 1 of 1961.] (2) Proof that notice under subsection (1) of this section has been given shall constitute prima facie evidence that the amount stated therein is due and owing, and the onus of proving otherwise shall rest on the person accountable for tax.

17. Objection to determination. (1) If a person disputes liability for the amount stated in the notice as provided in section 16 (1), or if he disputes an assessment made under section 24 (2), he may personally or by his agent, within sixty days after receipt of the notice or assessment, serve notice of objection upon the Board. [WN 1 of 1961.] (2) The notice of objection shall be in writing and shall be addressed to the Board. (3) The notice shall set out clearly the reasons for the objection and all facts relative thereto. (4) Upon receipt of the notice the Board shall duly consider the matter and affirm or amend the estimate or assessment and forthwith notify the appellant of its decision.

18. Appeal to judge. (1) If a person who has objected is dissatisfied with the decision of the Board he may appeal therefrom to a judge of the High Court. [WN 1 of 1961.] (2) The appellant shall, within sixty days from the date of the giving of the notice of the decision complained of, serve upon the Board a written notice of his intention to appeal which notice shall be signed by the appellant or by his solicitor or agent, and shall set forth the grounds of the appeal, and the appellant shall file a copy of the notice in the office of the Registrar of the Court. Within fourteen days after the service upon the Board of the notice of appeal, the appellant shall apply to the judge for the appointment of a day for the hearing of the appeal, and shall serve upon the Board not less than fourteen days before the hearing a written notice of the day appointed for the hearing. (3) The judge shall hear the appeal and the evidence adduced before him by the appellant and the Board, and shall decide the matter of the appeal. Upon request made to the judge by any party to the appeal, the hearing may be held in camera. (4) The Board shall cause to be produced before the judge on the hearing of the appeal all papers and documents in its possession affecting the matter of the appeal. [WN 1 of 1961.] (5) The costs of the appeal shall be in the discretion of the judge, and he may make an order respecting them in favour for or against the Government, and may fix the amount thereof. (6) The Chief Judge of the Delta State may make rules with respect to the practice and procedure of the Court on the hearing of appeals under this section.

19. Irregularities, etc., not to affect validity. Any estimate made by the Board under section 16 shall not be varied or disallowed because of any irregularity, informality, omission, or error on the part of any person in the observation of any directory provision of this Part or the regulations made hereunder. [WN 1 of 1961.]

20. Collection of taxes unaffected by pending appeals. Neither the giving of a notice of objection nor of appeal by any person, nor any delay in the hearing of an objection or an appeal shall in any way affect the due date of, or liability for, payment provided under this Part in respect of any tax due, and payable or that has been collected on behalf of the Government that is the subject matter of the objection or appeal or in any way delays the collection of the same; but in the event of the estimate of the Board being set aside or reduced on appeal, the Board shall refund the amount or excess amount of tax which has been paid or collected on behalf of the Government. [WN 1 of 1961.]

21. Liability for payment of tax collected. Every person who collects any tax under this Part shall be deemed to hold the same in trust for the Government and for the payment over of the same in the mapper and at the time provided under this Part, and the amount due shall, until paid, form a lien and charge of the entire assets of his estate in the hands of any trustee, having priority over all other claims of any person.

22. Summary proceedings without action. Where default is made in the payment of any tax that is due and payable under this Part or that has been collected, or any part thereof, the Chairman of the Board or any person duly authorised by the Board may issue a certificate stating the amount so due, the amount thereof remaining unpaid, and the name of the person by whom it is payable, and may file the certificate with any District Registrar of the High Court, or with the Registrar of any magistrate?s court, and when so filed the certificate shall be of the same force and effect, and all proceedings may be taken thereon, as if it were a judgment of the Court for the recovery of a debt of the amount stated in the certificate against the person named therein. [WN 1 of 1961, WN 20 of 1961.]

23. Bond deposit. (1) Where a person accountable for tax has failed to collect or to remit tax in accordance with the provisions made by or under this Part, the Board may require him to deposit with the Board a bond by way of cash or other security satisfactory to the Board. The amount of the bond shall be determined by the Board, but shall not be greater than an amount equal to six times the sum or the estimated sum of tax that would normally be collected by the person each month under this Law. (2) Where a person who has deposited a bond has failed to collect or to remit tax in accordance with provisions made by or under this Part, the Board may, by giving written notice to the person, apply the bond in whole or in part to the amount which should have been collected, remitted, or paid by that person as the amount due to the Government as of the date of the notice.

24. Powers of inspection. (1) Any person appointed by the Board may enter at any reasonable time the business premises occupied by any person, or the premises where his records are kept, to determine whether this Part and the regulations are being and have been complied, with, or to inspect, audit, and examine books of account, records, or documents, or to ascertain the quantities of produce whose sale is chargeable under this Part which have been bought by him or are in his possession, and the person occupying the premises shall answer all questions pertaining to these matters, and shall produce such books of account, records or documents as may be required. (2) Where it appears from the inspection, audit, or examination of the books of account, records, or documents that this Part or the regulations have not been complied with, the person making the inspection, audit, or examination shall calculate the tax collected or due in such manner and form and by such procedure as the Board may deem adequate and expedient, and the Board shall assess the person for the amount of tax so calculated, but the person so assessed may object or appeal against the amount of the assessment under sections 17 and 18.

25. Search warrant. (1) Any magistrate who is satisfied by information upon oath that there is reasonable ground for believing that any person has in his possession produce whose sale is chargeable under this Part in respect of which the tax payable has not been paid may at any time issue a warrant under his hand authorising any person, appointed by the Board, named therein to enter and search any building, receptacle, or place where such chargeable produce is believed to be situated, and to make such inquiries as are deemed necessary, and such person shall produce for inspection by the person named in the warrant any chargeable produce in his possession and answer any questions relating thereto. [WN 1 of 1961.] (2) Failure to answer questions or produce for inspection an offence. -Any person who refuses to answer any questions put to him under subsection (1) of this section respecting the chargeable produce kept on hand on the premises, or who fails to produce for inspection any books of account, records, or documents, or any parcel, box, carton, barrel, tank, or other receptacle in his possession or under his control, that he is required to produce for the purposes of inspection, shall be guilty of an offence and liable on conviction to a fine of one thousand naira or imprisonment for six months or both such fine and imprisonment.

26. Failure to collect or account for tax. (1) Any person accountable for tax under this Part who fails to collect and account for the same shall be guilty of an offence and liable on conviction to a fine equal to the amount of the tax that should have been collected and in addition to a fine of one thousand naira and in default of payment to imprisonment for six months. (2) A certificate under the hand of the Chairman of the Board or of any person duly authorised by the Board stating the amount of tax in default shall, for the purpose of subsection (1) of this section, be conclusive as to the amount of tax that should have been collected. [WN 1 of 1961, WN 20 of 1961.]

27. Failure to make returns, etc. Any person who- (a) fails or neglects to furnish any returns or information or to comply with any requirements of the Board as and when required by this Part or the regulations thereunder; or (b) makes or delivers a return which is false in any material particular, shall be guilty of an offence and liable on conviction to a fine of one thousand naira or imprisonment for six months or to both such fine and imprisonment.

28. Failure to register. Any person required by section 13 to become registered who fails within the time specified by that section to become registered shall be guilty of an offence and liable on conviction to a fine of twenty naira for each day during which he failed to become registered.

29. Regulations. The Executive Council may make regulations providing for any matter for which provision appears to it to be necessary for the purpose of giving effect to the provisions of this Part and in particular and without prejudice to the generality of the foregoing- (a) prescribing, in respect of any chargeable produce to which this Part applies, amounts for the purposes of section 13 (1); (b) prohibiting the sale of any chargeable produce to which this Part applies to a person required to be registered under this Part except in such places as may be prescribed; (c) prohibiting the purchase of any chargeable produce to which this Part applies by persons other than persons registered under this Part, either generally or in any specified circumstances or in respect of amounts of produce exceeding, in quantity or value, such amount as may be prescribed; (d) requiring the issue of invoices or similar documents in respect of chargeable sales of produce to which this Part applies and prescribing the particulars to be included therein; (e) imposing upon persons who appear to the Board to be carrying on a business which includes the buying of produce to which this Part applies the duty to furnish within such period as may be prescribed information in the prescribed form for determining whether such persons ought to be registered; [WN 1 of 1961.] (f) requiring persons registered under this Part to keep such accounts and records and to make such returns of sales to or by them of produce to which this Part applies and of the amounts of tax for which they are accountable, in respect of such periods, in such form and containing such particulars as may be prescribed, and to pay the amounts of tax appearing by the returns to be due from them at such times as may be prescribed; (g) requiring any persons concerned in the exportation of produce to which this Part applies to furnish to the Board within such time as may be prescribed such information relating to the export of such goods as may be prescribed; [WN 1 of 1961.] (h) prescribing the conditions upon which a refund of tax may be made in respect of the chargeable sale of produce subsequent to an original chargeable sale of the same produce; (i) prescribing anything which by this Part is authorised or required to be prescribed.

30. Evasion of tax. Any person who wilfully attempts in any manner to evade or defeat tax shall be guilty of an offence and liable on conviction to imprisonment for one year.

31. Refunds. (1) A deduction or refund of tax may be authorised by the Board- (a) where an overpayment has been made by the tax payer; [WN 1 of 1961.] (b) where the tax was paid in error; (c) subject to such conditions as may be prescribed, in the case of tax upon sales to which Part IV applies, where the Board is satisfied that the same produce has been the subject of an original chargeable sale and a subsequent chargeable sale. (2) No refund or deduction of tax shall be paid unless application is made therefore in writing by the person entitled thereto within six months of the time when the refund or deduction could first be claimed.

32. Recovery of tax. Subject to the provisions of this Law, tax may be sued for and recovered in a court of competent jurisdiction by action as for a debt due to the Government.

33. General powers of Board. For the avoidance of doubt, it is hereby declared that for the purpose of discharging its functions under this Law the Board shall have the powers vested in it by subsection (2) of section 4, subsections (4) and (5) of section 6, and section 9 of the Income Tax Law. [WN 1 of 1961, Cap. 12.] PRODUCE SALES TAX LAW. PART I [No. 18 of 1966.] Produce Rate of Tax Cocoa 8.00 per tonne Palm Kernels 2.00 per tonne Palm Oil 2.00 per tonne PART II [No. 3 of 1976.] Produce Rate of Tax Rubber N:k liquid rubber or latex 0.1 for every 1.8 kg 3.35 per litre