VAT: Delta State under fire for not taking official position
...Concerned stakeholders want state to join Rivers, Lagos to fight ...There's no competition, says Okowa's CPS
Delta State Government has come under fire for not taking official position on the raging issue of Value Added Tax (VAT), as concerned stakeholders in the state have told the state to join Rivers and Lagos States to play leading role in fighting for what rightly belongs to the people.
They called on Ifeanyi Okowa, Delta State Governor, to transmit a bill to the state house of assembly immediately, as part of measures to enable the state collect VAT from companies in it’s territory, as recently ruled by a Federal High Court sitting in Port Harcourt, Rivers State.
Delta Lives Matters, a pressure group from Delta State, made the call in a letter signed by it’s officials namely: Christian Abeh (Global Coordinator), Gabriel Mamuzo (Deputy Coordinator), Ifeanyi Ogor (Europe Coordinator) and made available to the media.
The group condemned the Federal Inland Revenue Services (FIRS) for being desperate in blocking Rivers State Government and other Southern States from collecting VAT in their territories.
“How can we be paying for consumption tax of goods purchased and services rendered here in Delta state and the VAT (money) will be given to people who see us as second class citizens?
“We can’t continue to use our resources to develop the northern states. Katsina, Yobe, Borno, Kano, Kwara, Gombe and other Northern states that have no business whatsoever benefiting from VAT gotten in Delta state.
“These people should look inward and develop their places than to continue being parasites to other states that are thinking of how to improve their economies.”
Also reacting to what he described as the inaction of Delta State government, Stephen Dieseruvwe, a former director-general, Delta State Traffic Management Authority, and chieftain of the All Progressives Congress (APC), stated that collection of VAT is an idea whose time has come.
He, charged Governor Okowa take the driver’s seat and give direction by ensuring that Delta State joins others to fight for what rightly belongs to the state, rather than sitting on the fence and waiting for the outcome of others’ efforts.
“I just listened to a debate on the judgement on Arise TV with a Lagos lawyer, Dele and the position is straightforward. The FIRS does not have the constitutional power to collect VAT, as it is a local tax on consumption, collectable by the states, he said.
“The pronouncements of FIRS that businesses should continue to pay VAT to them, pending the ruling of the appellate court, is a clear contempt of court, and can only happen in a country ruled by impunity. In the long run, the states will be victorious on this issue.”
He added, “It is not whether the federal high court’s ruling is implemented. It will for sure be implemented and that will be the start of fiscal federalism in Nigeria.
“I am of the opinion that Gov. Okowa hasn’t made a pronouncement on the ruling because his rubber-stamp DTHA are not around to do his bidding. But I have this feeling that, when they return from their jamboree, they will copy the Rivers and Lagos VAT laws for implementation.
This was as he described as jamboree and wastage of scarce resources, the training tour embarked upon by the state lawmakers, to the United Kingdom.
Olisah Ifeajiakah, chief press secretary to the Delta State Governor, Ifeanyi Okowa, had on Wednesday, said if the state government would start collecting Value Added Tax (VAT) from companies operating in the state, it would come out with a position on that.
He however, said that issue of VAT is just a small thing about true federalism, “There are major things like natural endowment, oil, among others. He said states should be allowed to harness them and do whatever they want to do and pay royalty to the center which is the federal government.
“The states should use the proceeds from the resources in their territories to develop their states. The FG is illegally collecting VAT and it is not her chief responsibility to do so,” he said.
“In those days, they were called regions but today, they are states. They should be allowed to tap resources available in their environment and pay royalty to FG because the state has much to do, and that would even reduce the responsibilities at the centre. That is the agitation of true federalism.
“So, if the VAT payment is one of it (true federalism), it’s well and fine. That Rivers State has started collecting, with Lagos following suit, does not mean that Delta must do so. No, there is no competition,” he asserted.
According to him, “What Rivers State has done was to approach the court for proper interpretation of an existing law about VAT in the constitution. The law has been there in the constitution; it’s just that it has been breached, with FG collecting and paying to states.
“With the recent court judgment, what we expect now is for it (the law) to have some form of application, not that states would begin to make new law in this regard.
Until that rule is set aside, it means that states are at liberty to collect VAT in their states.
“Rivers doing it and Lagos following shows that states are beginning to realise their rights – your right to true federalism and so many other things.”
He further said that, “This is a very good thing to prove that our laws are there but they should be run as they are.”