We’ve Appealed Against The Judgment Empowering Rivers State To Collect VAT

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*Says The Judgement Is Unfair

Governor Aminu Masari says Katsina is appealing against a recent
ruling by the Rivers Division of the Federal High Court, which held
that the Rivers government should take charge of collecting
value-added tax (VAT) in the state instead of the federal
government.

Mr Masari described the judgment as “unfair” while a delegation
from the Revenue Mobilisation and Fiscal Commission (RMAFC) paid
him a sensitisation visit at the Government House on August 31.

“We have heard the judgment of the State High Court in Rivers,
and we have appealed against that judgment,” said the governor.

The court had, on August 9, issued an order restraining the
Federal Inland Revenue Service (FIRS) from collecting VAT and
Personal Income Tax (PIT) in Rivers after the state government
filed a case against the agency and the attorney general of the
federation over illegalities.

Mr Wike’s administration, while citing a section of the 1999
constitution, sought that the power to collect taxes be exercised
by the state government.

In its judgment, the court, presided by Justice Stephen Pam,
noted that the Rivers government and not FIRS was authorized to
collect VAT.

Meanwhile, Lagos has announced that it had begun collecting VAT
in the state.

Days after the court ruling, Mr. Wike signed into law the bill
on VAT collection in the state, noting that the court addressed the
illegalities perpetrated by the FIRS on behalf of the federal
government.

He stressed that “states have been turned to beggars, hardly
will any day pass that you will not see one state or others going
to Abuja to beg for one fund.”

But this did not sit well with Mr. Masari, who said it would not
be implemented in Katsina, just as he argued that it would trigger
a burden on people.

“It means people will begin to pay double VAT because if you pay
VAT in Kano at the point of departure when you come to Katsina, you
will pay another VAT,” the Katsina governor reasoned. “If you pay
VAT in Lagos, it means you will also pay VAT all along the way
until you reach your destination. It will bring a lot of burden on
the people. That judgment is not fair.”

He further claimed that “it is other parts of the country that
make Lagos and Rivers states what they are.”

Sounding conciliatory, he added, “We have to work together as a
nation and come up with something that will work for all of
us.”

Mr Masari also faulted the revenue sharing formula between the
federal, state, and local government, describing it as “lopsided
and stagnant” and called for its review.

“The formula has become stagnant. It is lopsided. It puts more
resources at the centre and fewer resources for states and local
governments,” stated the governor. “The burden and responsibilities
of daily needs are at states and local government levels.”