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Exclusive: VAT Controversy: FG Plots To Move Case File To Abuja

Published

2 years ago

September 8, 2021

Editor

Following the landmark decision by Justice Stephen Pam of the Federal High Court sitting in Port Harcourt to throw out the stay of execution suit brought before the honourable court by the Federal Internal Revenue Service(FIRS), The Boss can exclusively reveal that plans are being made to move the case file from Port Harcourt to Abuja, the nation’s capital.

We are told that there is panic in the seat of power following the order of court that granting the request of the FIRS was akin to committing murder and the fact that Lagos State which is the largest contributor to the Value Added Tax (VAT) pool is already on the verge of passing a new law like Rivers State to start VAT Collection.

The Boss learnt from very reliable sources that though the FIRS has kept insisting on its legal right to collect the said tax and actually held a press conference today after losing the suit against the Rivers State Government, panic-stricken top functionaries of the federal government are designing plans to frustrate the implementation of the judgment because it will not only lead to serious revenue shortfall but throw FG’s financial projections overboard.

It will be recalled that on August 9, 2021 the Federal High Court sitting in Port Harcourt had declared that it is the Rivers State Government and not the Federal Inland Revenue Services (FIRS), that should collect Valued Added Tax (VAT) and Personal Income Tax (PIT) in the State.
The court, presided over by Justice Stephen Dalyop Pam, had also issued an order of perpetual injunction restraining the Federal Inland Revenue Service and the Attorney General of the federation, both first and second defendants in the suit, from collecting, demanding, threatening and intimidating residents of Rivers State to pay to FIRS, personnel income tax and Value Added Tax.
Justice Pam made the assertion while delivering judgement in Suit No. FHC/PH/CS/149/2020, filed by the Attorney General for Rivers State (plaintiff), against the Federal Inland Revenue Service (first defendant) and the Attorney General of the Federation (second defendant).
The Court, which granted all the eleven reliefs sought by the Rivers State Government, stated that there is no constitutional basis for the FIRS to demand for and collect VAT, Withholding Tax, Education Tax and Technology levy in Rivers State or any other State of the Federation, being that the constitutional powers and competence of the Federal Government is limited to taxation of incomes, profits and capital gains which does not include VAT or any other species of sales, or levy other than those specifically mentioned in items 58 and 59 of the Exclusive Legislative List of the Constitution.
The judge dismissed the preliminary objections filed by the defendants that the Court lacks jurisdiction to hear the suit and that the case should be transferred to Court of Appeal for interpretation.
Justice Pam, who also dismissed objection raised by the defendants that the National Assembly ought to have been made a party in the suit, declared that the issues of taxes raised by the State government are issues of law that the court is constitutionally empowered to entertain.
He declared that after a diligent review of the issues raised by both the plaintiff and the defendants, the plaintiff has proven beyond doubt that it is entitled to all the eleven reliefs it sought in the suit.
The court agreed with the Rivers State Government that it is the State and not FIRS that is constitutionally entitled to impose taxes enforceable or collectable in its territory of the nature of consumption or sales tax, VAT, education and other taxes or levies, other than the taxes and duties specifically reserved for the Federal Government by items 58 and 59 of Part 1 of the Second Schedule of the 1999 constitution as amended.
Also, the court declared that the defendants are not constitutionally entitled to charge or impose levies, charges or rates (under any guise or by whatever name called) on the residents of Rivers State and indeed any state of the federation.
Lead counsel for the Rivers State Government, Donald Chika Denwigwe (SAN), who spoke to journalists after the court session, explained that the case is all about the interpretation of the constitution as regards the authority of the government at the State and Federal levels to collect certain revenue particularly, VAT.
“So, during the determination of the matter, some issues of law were thrown up like, whether or not the case should be referred to the Court of Appeal for the determination of some issues.
“The court noted that the application is like asking the Federal High Court to transfer the entire case to the Court of Appeal. In which case, if the court so decides there will be nothing left to refer back to the Federal High Court as required by the constitution.”
Speaking on the implication of the judgement, Denwigwe said it is now, unlawful for such taxes as VAT in Rivers State to be collected by any agency of the Federal Government.
FIRS has revealed to journalists today that it has begun the process of appealing the judgment, but from all indications, the agency which is now beginning to fight like a wounded lion is bent on taking unusual steps to continue with what the high court has termed an illegality.

Related Topics:lagos state Rivers State VAT

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Tinubu Presents N27.5tr 2024 budget to NASS, Seeks Speedy Passage

Published

13 hours ago

November 29, 2023

Eric

President Bola Tinubu, on Wednesday, presented the Appropriation Bill of the Federal government for the year 2024 tagged ‘Budget of Renewed Hope’ to a joint session of the National Assembly.

This is the president’s first budget presentation to the National Assembly since assuming office on May 29.

The President arrived at the National Assembly for the presentation of the 2024 budget at about 11:09 am accompanied some ministers and aides. and senior officials.

He was led into the chamber of the House of Representatives for the presentation of the N27.5trillion Appropriation Bill to a joint session of the National Assembly which began after the rendition of the National Anthem and opening prayers.

The Federal Executive Council (FEC)on Monday approved N27.5 trillion as the 2024 budget estimate.

It will be recalled that Tinubu had about three weeks ago forwarded the 2024-2026 Medium Term Expenditure Framework ( MTEF) and Fiscal Strategy Paper ( FSP), proposing an expenditure of N26.1 for the 2024 fiscal year.

After two weeks of deliberations and interface with heads of Ministries, Departments and Agencies on the revenue and expenditure projections, the Senate through its Committee on Finance approved the MTEF.

It specifically approved the N26.1 trillion proposed as 2024 budget and other parameters proposed by Tinubu.

It also approved new borrowings of N7.8 trillion, while pegging the oil price benchmark for 2024 at $73.96 and oil production at 1.78 million barrels per day.

Other parameters approved are GDP growth rate of 3.76 per cent, the inflation rate of 21.40 per cent, a suggested benchmark exchange rate of N700 to $1 and a projected budget deficit of N9.04 trillion.

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Emefiele Yet to Meet Bail Conditions, May Stay in Prison Till 2024

Published

1 day ago

November 28, 2023

Eric

A Federal Capital Territory High Court, Abuja, has adjourned an alleged procurement fraud case involving a former Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele.

The court adjourned the trial of the former apex bank chief to January 18 and 19, 2024 for continuation of trial.

Emefiele is standing trial on a six count amended charge on alleged procurement of vehicles to the tune of N1.6billion.

He had pleaded not guilty to the charges.

He was granted bail on November 17, 2023 to the tune of N300million and two sureties, but remanded at the Kuje Correctional Centre, pending when he meets his bail conditions.

At the resumed hearing, the prosecution witness, who is a top official of the Corporate Affairs Commission (CAC) told the court that the Emefiele is not the owner or a shareholder of the April1616 Investment Limited awarded N1.2 billion vehicle supply contract by CBN under his watch.

He was led in evidence by counsel for the Economic and Financial Crimes Commission (EFCC), Mr. Rotimi Oyedepo , while tendering several documents on how the company was incorporated on August 1, 2016.

He further read out the names of the shareholders of the company as Aminu Yaro, Maryam Abdullahi and Saadatu Yaro as joint owners of the entity.

Emefiele’s lawyer, Mathew Burkaa, who declined to speak on camera, said Emefiele is yet to meet his bail conditions.

Counsel for the Economic and Financial Crimes Commission (EFCC) and the Federal government declined to speak on the day’s proceedings.

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One Year in Office: Adeleke Gives Scorecard, Pledges Continuous Democracy Dividends

Published

2 days ago

November 27, 2023

Eric

By Eric Elezuo

The Governor of Osun State, Ademola Adeleke, has felicitated with the people of Osun State as his administration marks one in office.

In the statement he personally signed, the governor informed that the last one year has been characterized by reconstruction and reconfiguration of various of the state’s economy, adding that the administration has been able to navigate through “numerous land mines deliberately set by the past administration to frustrate our administration” to provide appropriate leadership and benefits for the people of Osun state.

Adeleke further intimated that he is on a working visit to Europe and Asia, where he hope to attract investment opportunities foe the state.

The governor highlighted stability of the civil service, improved intercity road networks, surgical and medical outreaches as well as the #Imole100BInfrastructure as some of the laudable achievements of his administration in the last one year.

Below is the detailed statement:

It is one year ago today since our administration came into office. It has been a year of reconstruction and reconfiguration across the various sectors of the osun economy.

Due to the current economic situation in the state and our country in general, I have directed that this anniversary be conducted in a low key atmosphere. I remain committed to prudent use of our scarce resources on more pressing issues.

I am currently on a working vacation to Europe and Asia where I am advancing partnership discussion with potential investors needed to improve our state economy.

It is important to recognize the enormous challenges and obstacles we have overcome and the progress we have made thus far. Despite the numerous land mines deliberately set by the past administration to frustrate our administration, we have developed a robust mechanism to successfully navigate and overcome these challenges.

We have stabilized the state civil service with continuous commitment to the welfare of the state civil servants and pensioners, this we will continue to focus on in fulfillment of a critical part of our 5 point agenda.

We have massively improved intracity road network across the state by constructing over 90KM of roads, completion of the Phase II of Òṣogbo-Ikirun road and ongoing construction of Osun ring road (Ona Baba Ona) both abandoned by the past administration.

We have embarked on surgical and medical outreach that benefited over 50,000 vulnerable citizens. Also, we have completely rehabilitated over 31 schools across the state.

Recently, I launched the #Imole100BInfrastructure that focuses on education, health, road construction and water. These are critical sectors that we have identified to urgently revamp for the sustainability and development of the state economy.

I am happy to share that as we move forward, the positive results of our collaborative efforts for the past one year are expected to bear fruit. With projected increase in our internally generated revenue and prudent application of public funds, our infrastructure plan will be fully funded without seeking external loan.

Today, I re-affirm my commitment to serving with the fear of God and focused on delivering on my 5 point agenda as promised during the campaign season.

I thank you for your continuous support and prayer as you continue to support our efforts to develop our dear state.