The Lagos State Internal Revenue Service (LIRS) has announced that it will begin enforcing its statutory powers to recover unpaid taxes from defaulting taxpayers through third parties, including banks, employers, tenants, debtors, and business partners.
The directive was contained in a public notice dated January 21, 2026, and published on the official LIRS website.
According to the notice signed by the Executive Chairman of LIRS, Ayodele Subair, the agency is empowered under Section 60 of the Nigeria Tax Administration Act to invoke the power of substitution.
Under this provision, LIRS can direct any person or institution holding funds on behalf of, or owing money to, a taxpayer who has failed to settle a final tax liability, to remit such funds directly to the state revenue service.
LIRS clarified that the enforcement applies to several taxes administered by the agency, including:
• Personal Income Tax
• Capital Gains Tax
• Stamp Duties
• Withholding Tax
The agency urged taxpayers to regularise their tax affairs promptly, warning that failure to do so could result in recovery actions without further notice.
The move signals a tougher stance by the Lagos State Government on tax compliance, as it looks to boost internally generated revenue and close leakages in the tax system.
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