Babajide Sanwo-Olu, Lagos state governor, has signed the VAT bill passed by the house of assembly into law.
According to Gbenga Omotosho, the commissioner for information and strategy, the governor signed the bill into law on Friday.
He said the governor signed the “bill for a law to impose and charge VAT on certain goods and services” after returning from an official trip to Abuja.
“By this act, the Bill has now become a Law,” he added.
Appeal Court Orders All Parties To Maintain Status Quo
The Appeal Court sitting in Abuja has ordered all parties to maintain the status quo and refrain from taking action that would give effect to the judgement of a Federal High Court in Port Harcourt that allowed the Rivers State government to collect Value Added Tax (VAT), pending the hearing and determination of the instant suit.
A three-man panel of the appellate court led by Justice Haruna Tsammani gave the order on Friday while ruling on an appeal filed by the Federal Internal Revenue Service (FIRS).
The order of the appellate court is the latest development in the series of legal tussles over whose responsibility it is to collect VAT.
Although the FIRS has taken up the responsibility over the years, the Rivers State government tested the legality recently, and it was worth the move.
On August 19, Governor Nyesom Wike assented to the Valued Added Tax Law, 2021 along with four others following their passage by the Rivers State House of Assembly.
His action was sequel to the judgement delivered by Justice Stephen Pam of the Federal High Court in the state capital who held that states should collect VAT, and not the Federal Government.
Displeased with the decision of the court, the FIRS filed a motion on notice to apply for a stay of execution on the earlier judgement delivered by Justice Pam.
But the court said refused the application, saying the federal agency failed to file an application to set aside the tax law recently enacted by the Rivers State House of Assembly.
Justice Pam, therefore, stated that the state law on VAT was valid and subsisting.
The FIRS later approached the Court of Appeal in Abuja with a civil motion seeking a stay of the execution of the judgement earlier granted by the court in Rivers pending the determination of the case.
Kogi opposes Lagos, Rivers on VAT
The Kogi State government has said it will not involve itself in the pursuit to retain the Value Added Tax as embarked on by the governments of Lagos and Rivers.
The Governor of Rivers State, Nyesom Wike, had signed a bill on VAT followed by an order requiring businesses to henceforth pay VAT to the state and not to the Federal Inland Revenue Service.
He announced that the payment of VAT to the state will commence this September.
This was after a judgment by a federal high court in Port Harcourt restrained the FIRS from collecting VAT in the state.
The Lagos State government, in line with the judgment, also passed a VAT bill and asked the FIRS to stop collecting VAT from businesses in the state.
The move by both states was opposed by Kogi State through the Commissioner of Information, Kingsley Fanwo, in an interview with Arise TV on Friday.
He said, “We are not created equally, and God that created us did not give us equal potential, and we have to support one another.”
Speaking further, Fanwo said, “This call shows that some of our leaders are insensitive, self-centred and trying to make policies that will further divide the country.
“Kogi is bordered by about 10 states of the federation and a gateway to the north, south, to everywhere. And you know that thousands of vehicles transverse the state on a daily basis. It’s the mineral capital of Nigeria. When you look at our advantages, we should even be at the forefront of fighting for VAT to be completely retained in the state.”
He continued, “When you look at the development of the South-West in those days — the cocoa house — and the groundnut pyramids in the north, the whole of Nigeria is reaping the benefit till today. And what we need to do at this material time as leaders is to stop thinking about ourselves alone.
“The position of governor Yahaya Bello on this is very clear: we will not jump on that bandwagon to call for the retention of VAT completely in the state. We are not created equally, and God that created us did not give us equal potentials, and we have to support one another.”
