By Comrade Abba Abdullahi Chikaji
Kaduna Electric is facing an unprecedented tax reckoning, as the Kaduna State Internal Revenue Service (KDIRS) unleashes a vigorous tax recovery strategy that threatens to upend the company’s financial stability. With a N600 million tax liability already sealed, and additional levies, fines, and rates owed to various state MDAs, Kaduna Electric’s debt conundrum is about to get a whole lot worse.
KDIRS’ invocation of Section 3, Subsection 2 (b) and (c) of the Kaduna State Tax Codification and Consolidation Law marks a turning point in the agency’s approach to tax enforcement. By directing MDAs to process all outstanding liabilities, KDIRS is effectively mobilizing a multi-pronged attack on Kaduna Electric’s financial vulnerabilities.
The company’s recent disconnection of the Kaduna State Government House over an alleged debt of N2.9 billion may have been a desperate attempt to flex its muscles, but it has only served to provoke KDIRS into action. With the agency’s sights now firmly set on Kaduna Electric, the company faces a daunting array of challenges that threaten to cripple its operations.
Firstly, the sheer scale of the outstanding liabilities owed by Kaduna Electric is staggering. With multiple MDAs involved, the company will struggle to negotiate a way out of this financial quagmire. KDIRS’ decision to involve KADGIS, KADSWAC, Kaduna State Water Regulatory Commission, and KEPA in the tax recovery process means that Kaduna Electric will face a united front of creditors, each demanding payment.
Furthermore, KDIRS’ commitment to equitable taxation means that Kaduna Electric can expect no special treatment. The agency’s focus on tax-evasive and non-compliant organizations and high-net-worth individuals signals a zero-tolerance approach to tax defaulters. With KDIRS’ reputation for efficiency and effectiveness, Kaduna Electric can expect a relentless pursuit of payment.
In the face of this onslaught, Kaduna Electric’s options are dwindling. The company may attempt to negotiate a payment plan, but KDIRS’ hardline stance suggests that this may be a futile effort. With its financial back against the wall, Kaduna Electric may be forced to consider more drastic measures, such as asset sales or even bankruptcy.
One thing is certain: Kaduna Electric’s debt conundrum is about to get a whole lot worse. As KDIRS turns the heat up on the company, only time will tell if Kaduna Electric can survive the financial inferno that awaits it.
