ASABA — South-South Governors have declared their intention to join Rivers state at the Supreme Court in the ongoing tussle on the collection of Value Added Tax (VAT) by states.
In a statement signed by its chairman and governor of Delta, Ifeanyi Okowa, the forum said, “We Unequivocally support the decision for states to collect value-added tax, and resolved to join the suit before the Supreme court.”
The decision follows a meeting by the forum on Monday in Port Harcourt, where state governors under the BRACED Commission met to deliberate on a number of pressing issues.
Governors of the southern states, Ben Ayade, decided to join in the suit demanding that the consumption tax be collected by states and not remitted to the Federal Inland Revenue Service (FIRS).
In September, the Court of Appeal granted an application by the Lagos state government to be joined as a party in the suit filed by FIRS. Oyo state had also asked the Abuja division of the court to join as a respondent in the appeal filed by the revenue agency.
In August, the Rivers division of the Federal High Court declared that the FIRS had no constitutional backing for collecting VAT in the state and granted the power to collect the consumption tax to the Rivers state government.
Justice Stephen Pam issued an order of perpetual injunction restraining FIRS and Abubakar Malami from coercing residents of Rivers to pay VAT and personal income tax to FIRS.
Recalled that the FIRS had approached the National Assembly to move VAT matters to the exclusive list, this will then grant FIRS the right to collect local consumption taxes in states.
