Ekiti State Government on Wednesday sealed off the premises of the Guaranty Trust Bank (GTB) and Ecobank in the State for non-remittance of withholding tax.
Armed with the court order to shut the premises of the banks located at Secretariat Road, Ado-Ekiti, men of the Board of Internal Revenue (BIR) stormed the banks around 7.45am and prevented staff and customers from entering the premises.
The closure which caught the bank staff and customers unawares saw the customers agonising over the failure of the banks to remit the tax to the government’s coffer.
Apart from the doors to the banking halls, the gates of the two banks were firmly locked by the revenue officials
One of the officials of the banks said the affected banks had issues with the state government over their refusal to give money to government contractors handling rehabilitation of the Secretariat Road where they are located as part of their Corporate Social Responsibility (CSR).
An official of BIR who craved anonymity said the two banks were asked to submit documents relating to deductions on withholding tax on interests payable to customers.
According to the source, the state government had secured court orders to shut the banks adding that the action was within the ambit of the law.
He said: “The banks supposed to pay the withholding tax to the state government but they refused to do so.
“We commissioned a consultant to investigate the money they make on the interest on the deduction withholding tax and we discovered that the amount is huge.
“The government took the banks to court and the court granted our prayers to seal them off to recover the money.
“The court graciously granted the Ekiti State government the power to seal the banks until they pay the tax. The order was given by the Chief Judge, Justice Ayodeji Daramola on May 17, this year.
“This has nothing to do with the issue of CSR issue, it has to do with the withholding tax.”
Ekiti State Commissioner for Information, Lanre Ogunsuyi, appealed to customers of the affected banks to show understanding, expressing hope that the matter will be resolved within the shortest possible time.
Ogunsuyi explained that government action was backed by order of the court, saying the government is duty bound to collect taxes in public interest.