• Says it will negate principle of equity
• Wike to FIRS: Stop bullying corporate bodies from paying
•Alleges Masari, others attempting to truncate court ruling
• Urges govs to collectively fight for devolution of resources
• Threatens lockdown in Rivers again
Blessing Ibunge in Port Harcourt
Justice Stephen Pam of the Federal High Court sitting in Port Harcourt yesterday dismissed an application by the Federal Inland Revenue Service (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.
Accordingly, Rivers State Governor Nyesom Wike warned the FIRS against sabotaging the authority of the state to freely administer the VAT in line with the court ruling.
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.
But reacting to the Federal High Court ruling, in a state broadcast in Port Harcourt, Wike alleged that the FIRS was bullying corporate bodies and business entities in the state for refusing to pay VAT to the federal agency. He said Rivers State would not allow further collection of VAT from corporate bodies and businesses operating in the state by the federal government agency.
The governor argued that the FIRS failed in its attempt to frustrate the enforcement of the state’s law on VAT with the Federal High Court’s dismissal of its application for stay-of-execution of the judgement.
Wike explained, “Following the recent judgement of the Federal High Court, Port Harcourt, which upheld the constitutional right and authority of state governments to impose, collect and utilise VAT within their respective territorial jurisdictions, the Rivers State government enacted the Rivers State Value Added Tax Law 2021 to regulate the effective administration of VAT in Rivers State.
“As expected, the federal government, through the FIRS, disagreed and filed an appeal coupled with a request for stay-of-execution of the judgement before the Federal High Court.
“While the appeal was pending and without any stay-of-execution of the subsisting judgement, the FIRS went about to bully corporate bodies and business entities for paying the VAT to the Rivers State Government, even when they knew that an appeal does not serve as a stay neither was there anything to stay in a declaratory judgement.”
The governor added, “As a mere agency of the federal government without any political authority, the effrontery and impunity exhibited by the FIRS against the Rivers State Government was ill-advised and highly provocative.
“However, being a government that believes in the rule of law, we decided on our own to suspend the enforcement of the Rivers State VAT Law 2021 pending the outcome of the FIRS’ application for stay-of-execution.
“Today, the FIRS has failed in its attempt to frustrate the enforcement of the state’s law on VAT with the Federal High Court’s dismissal of its application for stay-of-execution of the judgement.
“It is important to reiterate the fact that we did no wrong in exercising our legal right under our constitutional democracy to stop the continuing breach, denial and curtailment of the constitutional right of states to lawfully impose and collect value added and other related taxes within jurisdiction to the exclusion of the federal government.
“And in doing so, our singular and progressive objective was to contribute to the advancement of fiscal federalism by enabling the federating states to explore and exploit their potential and capacity for generating greater internal revenues with which to fund their development goals and reduce the out-dated over-reliance on pitiable federal allocation and other hand-outs.”
Wike stressed that Rivers State would not tolerate any further attempt by the FIRS to sabotage or undermine its authority to freely administer VAT and other related laws in the state, saying, “those who play with fire risks having their fingers burnt. Enough of the shenanigans.”
The governor noted that some states currently with low economic activities and ethically restrictive social policies, with economic implications, might be adversely affected for now, but pointed out that it was not Rivers State’s making.
Wike state, “Like the right to derivation, this is also a constitutional prescription, which we all swore as political leaders to respect and defend as the supreme law of the land.
“Above all, fiscal federalism remains the right path to economic self-reliance and sustainability for all our states and the benefits derivable from this case by all the states in the long run far outweighs the immediate revenue loss that some states may presently suffer.
“All that is required is for all of us to wear our thinking caps as elected governors to collectively fight for the greater devolution of resources, responsibilities and powers to the federating states.
“It is, therefore, very unfortunate that some state governors, led by that of Katsina State, are vainly conspiring to truncate this progressive reality in favour of the inequitable status quo so that the federal government can continue to rob Peter to pay Paul as the nation’s self-imposed tax master-general.”
Wike said the state government would continue to ensure and project constitutional rights to access all possible resources that could take hold both within and outside the geographical boundaries to advance the progress of the state.
He, therefore, directed the Rivers State Revenue Service (RSRS) to ensure the full and total implementation and enforcement of the law against all corporate bodies, business entities and individuals with immediate effect.
“All corporate bodies, business entities and individuals are advised to willingly, truthfully and promptly comply with their tax obligations under this law to avoid the full weight of the stipulated sanctions, including having their business premises sealed-up.”
Meanwhile, the governor warned that it might re-impose a lockdown across the 23 local government areas of the state if residents continued to neglect the COVID-19 protocols. Wike disclosed that the rate of COVID-19 cases was increasing rapidly in the state, as reported by the Nigeria Centre for Disease Control (NCDC). He urged Rivers residents to comply with the protocols and take their vaccines.
The governor appealed to religious leaders and churches to convince and encourage their followers and members to go out and take the vaccines and comply with the COVID-19 protocols.
He stated, “The daily figures released from the NCDC show that both the transmission and death rates in the last two weeks have consistently been on a rising spiral because residents and visitors to the state have largely abandoned their responsibility to comply with the existing COVID-19 protocols.
“Clearly, we are headed for a serious health disaster of profound consequences if residents and visitors continue to behave as if the pandemic no longer exists or impotent in Rivers State.
“This is a big lie and we cannot afford to continue to close our eyes to the dangers such irresponsible behaviour pose to the health, lives and livelihood of everyone.
“Accordingly, I wish to remind residents of the subsisting protocols on regular washing of hands and use of alcohol-based sanitisers; maintaining social distancing; wearing of face masks at all public places, including transport vehicles and going for immediate testing and treatment whenever you notice any of the symptoms.
“Although it remains our desire to keep the state open and allow citizens to go about their social, religious and economic activities unimpeded.
“But we may be constrained to re-impose the suspended COVID-19 lockdown measures across the state if the transmission of the disease continues to increase beyond tolerable limits.
“Furthermore, it has been proven that vaccinations are saving lives here and across the world and those refusing to take the vaccines for no certified medical reasons should know that they are endangering the rest of the citizens.”
