Lagos based activist and human rights lawyer, Ebun-Olu Adegboruwa (SAN) has commended the Rivers State Governor, Nyesom Wike for his unwavering stance and his efforts to get judicial pronouncement restraining the Federal Inland Revenue Service (FIRS) from collecting Value Added Tax (VAT) and Personal Income Tax (PIT) in the state.
Adegboruwa, who gave the commendation in a statement on Thursday, September 9, 2021, noted that the battle that the Rivers State Government embarked upon is in line with the yearnings and clamour of the people for restructuring.
He emphasised that the ruling of the court is a step in the right direction towards the much-desired restructuring needed in the country.
According to him, “State VAT law is a form of restructuring. It is restructuring and I support it 100 per cent. We have been shouting and crying for this lopsided federalism to be made equitable. Those who make peaceful change impossible make violent change inevitable.
“I commend Gov Wike who started this revolution. I also commend Gov Sanwo-olu, my LBS and Hon A.G, Onigbanjo and the Lagos House of Assembly. Other laws should follow.
“The Lagos State Government should go to Lagos High Court to seek an order for immediate compliance with the VAT law by all persons and authorities doing business in Lagos State.
It’s a good beginning. Enough of feeding-bottle federalism and Abuja financial pilgrimage,” Adegboruwa stated.
It will be recalled that the Federal High court sitting in Port Harcourt, Rivers State, had issued an order restraining FIRS from collecting VAT and Personal Income Tax (PIT) in the state after a long battle between the FIRS and Rivers State Government.
The court had further directed the Rivers state government to take charge of the collection of VAT and PIT in the state.
The implication of this is that other state governments can follow the trend and collect VAT in their jurisdictions.
FIRS had filed a stay of execution which was dismissed by the Court. Justice Stephen Pam of the Federal High Court sitting in Port Harcourt dismissed an application by the FIRS seeking to stop the Rivers State Government from collecting Value Added Tax (VAT) in line with an earlier judgement in favour of the state.
Pam held that granting the application would negate the principle of equity.
The FIRS in suit no FHC/PHC/149/2021 had approached the court seeking a stay-of-execution on an earlier judgement of the court that stopped the agency from collecting VAT, and held that it was constitutionally the role of state governments.
The FIRS had following the judgement against it requested the high court to stop the Rivers State government from executing the ruling.
Pam stated that in as much as the state government and the state legislature had enacted a law with respect to VAT, the courts were bound to obey such law. He said the state government and the House of Assembly had duly enacted the Rivers State Value Added Tax No. 4, 2021, which makes it a legitimate right of the state to collect VAT.
The judge maintained that the law remained valid until it had been set aside by a court of competent jurisdiction.
Pam further said granting the prayers of the FIRS would amount to committing murder. He noted that the prayers could not stand and, hence, dismissed them.
