Laments sharing of 50% VAT to other states
Lagos State Governor, Mr. Akinwunmi Ambode, has faulted attempt by the federal government to regulate hotels, restaurants and event centres in the state, noting that the attempt violates the decision of the Supreme Court and 1999 Constitution.
Ambode has equally faulted the formula for sharing Value Added Tax (VAT) among states of the federation, though the federal government allocated 50 per cent of it somewhere else contrary to the ideals and spirit of true federalism.
He rejected the practice at a public forum he addressed on Tuesday, noting that attempts by the federal government to regulate hotels and restaurants was an anomaly that should be addressed accordingly.
In 2013, the federal government had challenged the power and right of the Lagos State Government at the Supreme Court “to make laws on tourism, specifically where the National Assembly had already legislated on the same issue through the NTDC Act.”
Specifically, the federal government then asked the Supreme Court to declare null and void the Lagos State Hotel Occupancy and Restaurant Consumption Law, 2009; Hotel Licensing Law, 1983 and Hotel Licensing (Amendment), all of which were enacted by the State House of Assembly.
In its decision, however, the apex court rejected the prayers of the federal government, noting that the constitutional powers of the federal government “are expressly limited to tourism traffic in Nigeria in line with Item 60(d) of Part I of Second Schedule to the 1999 Constitution.
Contrary to the decision of the apex court, the Senate initiated a process to repeal the Nigerian Tourism Development Corporation (NTDC) Act, 2004 and replace it with the Nigerian Tourism Development Authority (NTDA) Bill, 2017 if it eventually sails through.
At the public forum, Ambode lamented the initiation of the NTDA Bill 2017 which he said, was an attempts by the federal government to regulate hotels, restaurants and event centres contrary to the decision of the Supreme Court.
He explained that the Lagos State House of Assembly enacted the Hotel Occupancy and Restaurant Consumption Law, which the Supreme Court ruled, was accordingly passed into law in consonance with the 1999 Constitution.
Despite the existence of Hotel Occupancy and Restaurant Consumption Law, the governor lamented that there were still attempts from the central government to regulate hotels and entertainment centres in the state.
He said: “We enacted a law. Somebody says he wants to enact another law that regulates hotels inside Lagos State. Is it not because of the roads that they put hotel there? These things are purely under residual list. It is within our jurisdiction.”
The governor explained that undue interference in local matters “makes devolution of power imperative. That is what devolution of power is saying. If these things are on residual list, let local government and states deal with them.
“That is all that we are asking for. It is not that we will generate Value Added Tax (VAT) here and somebody will be sharing 50 per cent of the VAT somewhere else. Obviously, that is the whole idea behind this agitation for true federalism, devolution of powers and the need to use it to liberate ourselves so that we can get more prosperous; so that our people can be more comfortable.”