VAT

VAT Collection By States: More Governors Backing Wike Of  Rivers State

 

The Akwa Ibom and Adamawa state governments on Tuesday aligned themselves with the move by the Rivers State Governor, Nyesom Wike, to stop the Federal Government from collecting Value Added Tax.

The Director-General, Media and Communications, Adamawa State Government, Solomon Kumangar, in an interview with one of our correspondents in Yola, the state capital, said that the collection of VAT by the states was the only way of reducing their dependence on federal allocations.

The Akwa Ibom House of Assembly, on its part, said it would soon begin work on a bill that would enable the state to collect VAT.

Similarly, Lagos said it would go ahead with the VAT bill, which passed second reading in the state House of Assembly on Monday.

But the governments of Ekiti, Osun and Benue states said they were still studying the situation before making any move.

The Federal High Court sitting in Port Harcourt in its judgment last month in a suit marked FHC/PH/CS/149/2020 held that the Rivers State Government had the powers to collect VAT within its territory.

The Federal Inland Revenue Service, on Monday, prayed the court to stay execution on the judgment.

But the presiding judge, Justice Stephem Pam, rejected the application, saying granting it would negate the principle of equity.

On Monday, the Lagos State Government toed the path of Rivers State as a bill to empower it to collect VAT scaled second reading in the state House of Assembly.

VAT is a consumption tax paid when goods are purchased and services are rendered. It is charged at a rate of 7.5 per cent.

On Tuesday, the Adamawa State Government told The PUNCH that the judgment was of interest to it.

Kumangar said the state government might seek to be joined in the Rivers State versus the FIRS VAT suit as an interested party.

He said Adamawa State, which is heavily reliant on federal allocations and overstretched by the impact of COVID-19 and post-insurgency recovery demands of rebuilding, saw the development in Rivers State as one of particular interest to it.

Adamawa State, according to him, welcomes the court ruling as another avenue for states struggling with financial problems to utilise, extend and improve their internally generated revenues.

Kumangar stated, “Anything to extend and improve on our IGR is welcomed. So, we are keen on joining the River State Government should the Federal Government appeal the judgment, which granted Rivers State the right to collect VAT in its domain.

“Whatever will bring improvement to the IGR is a welcome idea for an insurgency ravaged state like Adamawa. The truth is that the collection of VAT by the states is the only way to assist the states, which are heavily dependent on federal allocations, to be able to wean themselves and meet their financial obligations to the citizens. So, if there are areas where revenues can be exploited and extended, surely the state government will welcome it. Surely it’s a case of interest to us and we would like to be joined.”

Akwa Ibom Assembly to begin work on bill, state targets oil firms
The Chairman, Akwa Ibom State House of Assembly Committee on Information, Aniefiok Akpan, in an interview with one of our correspondents, said the House would start working on the VAT bill as soon as possible.

He disclosed that a member had indicated interest in the bill and would soon introduce it on the floor of the House.

“We will start working on the bill. I don’t know whether it is going to be an executive bill or the House will initiate it. A member has indicated interest in bringing the bill,” Akpan stated.

The state governor, Udom Emmanuel, expressed disappointment that the government was not collecting VAT from oil companies operating in the state despite being home to one of the largest oil and gas reserves in the country.

*PUNCH

 

About Notable Outcome

Check Also

Tinubu’s Supporters Demand Replacement Of Muslim VP Candidate With A Christian

(By Chris K.Amadi) – The last is yet to be heard and seen about agitations …

0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments