…As Gombe Begs Southern States
Governor Nyesom Wike of Rivers State on Wednesday said that the Federal Government knew that it was collecting Value Added Tax (VAT) illegally.
Wike made public through his Facebook account, a letter written to the National Assembly by the Chairman of the Federal Inland Revenue Service (FIRS), Muhammad Mamman Nami “to amend the Constitution and empowered the Federal Government to collect Value Added Tax (VAT).”
Wike warned FIRS to stop its “bullying”, and is also accusing them of “doing things illegally”.
He wrote on his known Facebook page: “We filed the Value Added Tax (VAT) collection action against FIRS and the office of the Attorney General representing the Federal Government in 2020.
“In July 2021 the Chairman of FIRS wrote to the National Assembly through the Office of the Deputy Speaker of the House of Representatives to amend the Constitution and empowered the Federal Government to collect VAT. They knew what they were doing was unconstitutional so in July 2021 they wrote a letter for the constitution to be amended to Include VAT in the exclusive legislative list.
“This was exactly what we were challenging in court so they tried to include it through the back door. Corruption is not only people collecting money, corruption is also doing things illegally.”
Meanwhile, Gombe State has appealed for understanding by other states on the sharing formula of VAT generated in the country.
Gombe State Commissioner for Finance and Economic Development, Muhammad Magaji, speaking at the opening of a technical workshop on development of the Medium-Term Sector Strategy (MTSS) for the state, urged the southern states put sentiment aside and become brothers’ keepers in sharing the VAT generated in their respective states.
He said: “The VAT issue will have adverse effects not only on Gombe State but almost all the states of the Federation. I was part of the discussion few weeks ago by all commissioners of finance across the country.
“The realisation is that only Lagos, Rivers and probably Delta states would be able to pull through without this VAT being administered centrally, and it is our appeal that we all put sentiments behind and work towards a federation that is one, by being our brothers’ keepers and ensuring that what is pull together at the center is distributed to be able to balance resources across the country.”
He acknowledged the fact that hard times are ahead if every state will be asked to control its resources.
“Don’t forget that the oil producing states collect only 13 per cent derivation, so if you say every state will take whatever resources it has, that means we are starting a very dangerous trajectory that will not augur well for the Federation called Nigeria,” he added.