VAT: Taxpayers In Dilemma As Rivers Govt, FIRS Tango

Taxpayers especially in Rivers State are currently in a logjam
over who to remit their Value Added Tax (VAT) to between the state
government and Federal Inland Revenue Service (FIRS).

Following a ruling by a Federal High Court restricting FIRS from
collecting VAT and other such levies, the state House of Assembly
enacted a VAT Bill, which has been signed into law by Governor
Nyesom Wike last week.

House of Assembly at the Government House, Port Harcourt.

At the signing ceremony on Thursday, Wike that the judgment of
the Federal High Court sitting in Port Harcourt had sufficiently
addressed the illegality perpetrated by the Federal Inland Revenue
Services (FIRS).

He pointed out that when agencies of the Federal Government are
allowed to illegally demand and collect taxes meant for states,
they strangulate the states financially and turn them to be
beggars.

“But we (Rivers State) are standing on the part of history as
representatives of the state to have taken the bull by the horn to
challenge the illegality of the Federal Government through the
Federal inland Revenue Services (FIRS).

But in a statement on Sunday, FIRS asked tax payers to continue
to pay their VAT it.

The statement from Director, Communications and Liaison
Department, Ismail Ahmad noted that it had appealed the judgement
and a ruling was being awaited from the Appeal Court.

It reads: “the attention of the Federal Inland Revenue
Service(FIRS) has been drawn to the trending report that, on
19/08/2021, the Government of Rivers State took steps to enact a
Value Added Tax Law for Rivers State following the Judgment of the
Federal High Court Port Harcourt Division on 9th August 2021 in
Suit No: CS/149/2020.

“The suit was about who has the constitutional duty for the
collection of VAT and Personal income tax in Rivers State.

“We wish to inform the general public that, before the
above-mentioned steps taken by the Government of Rivers State, FIRS
had lodged an appeal against the above judgment and had also filed
an application for stay of execution of the Judgment as well asking
the Court for an injunction pending determination of the
appeal.

“All parties to the suit are aware that both applications were
heard on the 19th and 20th August 2021 and are awaiting the
decision of the Court.

“Given that the Court of Appeal is yet to rule on the Appeal
from the Judgement of Federal High Court and that the Federal High
Court is yet to deliver a ruling on FIRS’s applications for stay of
execution and injunction, members of the public are advised to
continue to comply with their Value Added Tax obligations until the
matter is resolved by the appellate courts.”

Taxpayers especially in Rivers State are currently in a logjam
over who to remit their Value Added Tax (VAT) to between the state
government and Federal Inland Revenue Service (FIRS).

Following a ruling by a Federal High Court restricting FIRS from
collecting VAT and other such levies, the state House of Assembly
enacted a VAT Bill, which has been signed into law by Governor
Nyesom Wike last week.

House of Assembly at the Government House, Port Harcourt.

At the signing ceremony on Thursday, Wike that the judgment of
the Federal High Court sitting in Port Harcourt had sufficiently
addressed the illegality perpetrated by the Federal Inland Revenue
Services (FIRS).

He pointed out that when agencies of the Federal Government are
allowed to illegally demand and collect taxes meant for states,
they strangulate the states financially and turn them to be
beggars.

“But we (Rivers State) are standing on the part of history as
representatives of the state to have taken the bull by the horn to
challenge the illegality of the Federal Government through the
Federal inland Revenue Services (FIRS).

But in a statement on Sunday, FIRS asked tax payers to continue
to pay their VAT it.

The statement from Director, Communications and Liaison
Department, Ismail Ahmad noted that it had appealed the judgement
and a ruling was being awaited from the Appeal Court.

It reads: “the attention of the Federal Inland Revenue
Service(FIRS) has been drawn to the trending report that, on
19/08/2021, the Government of Rivers State took steps to enact a
Value Added Tax Law for Rivers State following the Judgment of the
Federal High Court Port Harcourt Division on 9th August 2021 in
Suit No: CS/149/2020.

“The suit was about who has the constitutional duty for the
collection of VAT and Personal income tax in Rivers State.

“We wish to inform the general public that, before the
above-mentioned steps taken by the Government of Rivers State, FIRS
had lodged an appeal against the above judgment and had also filed
an application for stay of execution of the Judgment as well asking
the Court for an injunction pending determination of the
appeal.

“All parties to the suit are aware that both applications were
heard on the 19th and 20th August 2021 and are awaiting the
decision of the Court.

“Given that the Court of Appeal is yet to rule on the Appeal
from the Judgement of Federal High Court and that the Federal High
Court is yet to deliver a ruling on FIRS’s applications for stay of
execution and injunction, members of the public are advised to
continue to comply with their Value Added Tax obligations until the
matter is resolved by the appellate courts.”