Connect with us

News

Court bars Fed Govt’s from collecting VAT, Income Tax

Published

on

TAX

 

The Federal High Court sitting in Port Harcourt, has declared that it is the Rivers State Government and not the Federal Inland Revenue Services (FIRS), that should collect the Valued Added Tax (VAT) and Personal Income Tax (PIT) in the state.

The court, presided over by Justice Stephen Dalyop Pam, also issued an order of perpetual injunction restraining the Federal Inland Revenue Service and the Attorney-General of the Federation, both first and second defendants in the suit, from collecting, demanding, threatening and intimidating residents of Rivers State to pay to FIRS, personnel income tax and VAT.

Justice Pam made the declaration while delivering judgment in suit No. FHC/PH/CS/149/2020, filed by Attorney-General for Rivers State (plaintiff), against the FIRS (first defendant) and the Attorney-General of the Federation (second defendant).

The court, which granted all the eleven reliefs sought by the Rivers State Government, stated that there was no constitutional basis for the FIRS to demand for and collect VAT, Withholding Tax, Education Tax and Technology levy in Rivers State or any other state of the Federation.

Pam said the constitutional powers and competence of the Federal Government was limited to taxation of incomes, profits and capital gains, which did not include VAT or any other species of sales, or levy other than those specifically mentioned in items 58 and 59 of the Exclusive Legislative List of the Constitution.

The judge dismissed the preliminary objections filed by the defendants that the court lacked the jurisdiction to hear the suit and that the case should be transferred to the Court of Appeal for interpretation.

See also  Elections: Labour Party faults process, to challenge result in court

Justice Pam, who also dismissed the objection raised by the defendants that the National Assembly ought to have been joined in the suit, declared that the issues of taxes raised by the state government were the matters of law that the court was constitutionally empowered to entertain.

He declared that after a diligent review of the issues raised by both the plaintiff and the defendants, the plaintiff had proven beyond doubt that it was entitled to all the 11 reliefs it sought in the suit.

The court agreed with the Rivers State Government that it was the state and not FIRS that was constitutionally entitled to impose taxes enforceable or collectable in its territory of the nature of consumption or sales tax, VAT, education and other taxes or levies, other than the taxes and duties specifically reserved for the Federal Government by items 58 and 59 of Part 1 of the Second Schedule of the 1999 constitution as amended.

The court, also declared that the defendants were not constitutionally-entitled to charge or impose levies, charges or rates (under any guise or by whatever name called) on the residents of Rivers and any state of the federation.

Among the reliefs sought by the Rivers State Government, was a declaration that the constitutional power of the Federal Government to impose taxes and duties was only limited to items 58 and 59 of Part 1 of the second schedule of the 1999 constitution as amended.

See also  Two dead, many injured in Ibadan

The Rivers State Government also urged the court to declare that, by virtue of the provisions of items 7 and 8 of the Part II(Concurrent Legislative List) of the Second Schedule of the constitution, the power of the Federal Government to delegate the collection of taxes could only be exercised by the state government or other authority of the state and no other person.

The state had further asked the court to declare that all statutory provisions made or purportedly made in the exercise of the legislative powers of the Federal Government, which contained provisions inconsistent with or in excess of the powers to impose tax and duties, as prescribed by items 58 and 59 of the Part I of the Second Schedule of the 1999 constitution, or inconsistent of the power to delegate the duty of collection of taxes, as contained in items 7 and 8 of Part II of the Second Schedule of the Constitution, were unconstitutional, null and void.

The Lead Lawyer to Rivers State Government, Donald Chika Denwigwe (SAN), who spoke to journalists after the court session, explained that the case was all about the interpretation of the constitution in respect of the authority of the government at the state and federal levels to collect certain revenue particularly VAT.

He said: “So, during the determination of the matter, some issues of law were thrown up like, whether or not the case should be referred to the Court of Appeal for the determination of some of the issues.

See also  322,000 Nigerian refugees in Niger, Chad, Cameroon- FG

“The court noted that the application is like asking the Federal High Court to transfer the entire case to the Court of Appeal. In which case, if the court so decides there will be nothing left to refer back to the Federal High Court as required by the constitution.”

According to Denwigwe, the court refused such prayer and decided that the case was in its proper place before the Federal High Court.

Speaking on the implication of the judgment, Denwigwe said it had become unlawful for such taxes like VAT in Rivers State to be collected by any agency of the Federal Government.

He said: “In a summary, it is a determination that it is wrong for the Federal government to be collecting taxes which are constitutionally reserved for the State governments to collect.

“The implication of the judgment is that the government (Federal and State) as an authority under the constitution, should be advised by the judgment that it is the duty of all government authorities to comply with and obey the law so long as the court has interpreted it and said what that law is.

“So, in other words, the issue of Value Added Tax (VAT) in the territory of Rivers State and Personal Income Tax should be reserved for the government of Rivers State.”

But the Lawyer to FIRS, O.C. Eyibo said he would study the judgment and advise his client.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

News

Insecurity: Eliminate terrorists within 90 days or resign, Adeboye tells service chiefs

Published

on

By

The general overseer of the Redeemed Christian Church of God (RCCG), Pastor Enoch Adeboye, has asked Nigeria’s security chiefs to eliminate terrorists within 90 days or step down.

In a video posted on the church’s X handle on Tuesday, Adeboye urged the Federal Government to act swiftly in addressing the country’s security challenges.

“If I were asked to make suggestions, I would say quietly to our government, move fast. And tell our security chiefs, get rid of these terrorists within 90 days, or resign,” Adeboye said.

The cleric noted that religious leaders can only offer advice to political authorities, and that the final responsibility rests with the commander-in-chief.

Adeboye said he advised late President Muhammadu Buhari who gave security chiefs a similar deadline to tackle Boko Haram, but that the directive was not fully achieved within the timeframe.

In 2021, Buhari ordered the then service chiefs to “take out” bandits, kidnappers, and their sponsors.

See also  THE VAT CONTROVERSY: What states generated, received between January-August 2021

The late president said the armed forces should be more proactive rather than reactionary.

Adeboye said the former president acted on the advice by issuing the directive to security chiefs, but failed to enforce it after the deadline elapsed.

“He ran with that advice, but he didn’t follow it through. Because he gave the order as the commander-in-chief of the armed forces.The three months went, and the work was not done,” he said.

The RCCG general overseer said he later questioned the former president over his decision not to act after the deadline passed, but declined to give details of their conversations.

He called on the current government to ensure that any directive given to security chiefs goes beyond neutralising terrorists to also targeting those who finance and support them.

“When giving orders to the service chiefs this time around, we should make it clear to them that they are not only to eliminate the terrorists, they should eliminate their sponsors, no matter how influential they may be,” Adeboye added.

See also  APC reveals identities of those working against Tinubu

His comments come amid renewed concerns over insecurity across the country, following a series of kidnappings, attacks on communities and abductions of students in recent months.

On May 15, some gunmen attacked two schools in Ogbomoso, Oyo state abducting dozens of pupils and teachers. One of the teacher would later be beheaded in a viral video circulating online.

Following the abduction, President Bola Tinubu directed the deployment of a “specialised security unit with advanced rescue capabilities” to intensify efforts to secure the release pupils and teachers.

The abduction adds to a string of similar incidents recorded across the country in recent months.

Continue Reading

News

Bandit leader Kachallah contacts abducted army General’s family, seeks release of gang members

Published

on

By


A notorious bandit leader, Kachallah Muhammad, has reportedly established communication with relatives of the abducted retired senior military officer, Major General Rabe Abubakar Batsari.

According to reports by Daily Trust, the bandit kingpin, who operates in parts of Katsina State, opened a line of communication with the family of the retired General on Monday morning.

The retired Major General and his wife were reportedly abducted on Saturday in Katsina State.

Their vehicle was ambushed along the Marabar Musawa–Kafinsoli Road in Matazu Local Government Area by gunmen, who, according to witnesses, emerged from hiding, blocked the road and opened fire on the vehicle, forcing it to a halt before abducting the retired officer and his wife into a nearby forest.

The road, according to residents of the area, is unsafe due to repeated bandit attacks.

A senior local government official in Batsari, who spoke on condition of anonymity due to security concerns, confirmed to our correspondent that he personally spoke with the abducted officer during the conversation facilitated by the bandit leader.

See also  Two dead, many injured in Ibadan

“I spoke with Major General Rabe through Kachallah Muhammad. He told us that he is hale and hearty and that his wife is also fine,” the official said.

According to the source, the retired general assured his family and associates that they are being adequately taken care of by their captors, a development that has somewhat eased anxiety among relatives and residents of the area.

The official further disclosed that during the interaction, Kachallah Muhammad made his demands clear, insisting on the release of his relatives, allegedly being held by Nigerian security authorities.

“He said what he wants is the immediate release of his relatives in government custody,” the official added.

The bandit leader, the source said, also expressed willingness to return to negotiations, indicating openness to dialogue aimed at restoring peace in Matazu and other areas under his influence.

“He said he is ready to go back to the negotiation table to achieve peace in Matazu and neighbouring communities,” the official said.

See also  322,000 Nigerian refugees in Niger, Chad, Cameroon- FG

Continue Reading

News

FG cancels three-month pre-retirement leave for civil servants

Published

on

By


The Federal Government has directed ministries, departments, and agencies (MDAs) to stop placing civil servants on a mandatory three-month pre-retirement leave.

According to reports, the directive is contained in a circular titled ‘Correct Interpretation of Public Service Rule 120243 on Pre-Retirement Activities’, issued by Didi Walson-Jack, head of the civil service of the federation.

The circular, addressed to ministers, permanent secretaries, service chiefs, heads of agencies, and other senior public officials, said the Public Service Rules (PSR) do not provide for a compulsory three-month leave before retirement.

Walson-Jack said several MDAs had misconstrued the three-month retirement notice period as an automatic leave entitlement, resulting in officers being withdrawn from service before their official retirement dates.

According to her, Rule 120243 only requires officers approaching retirement to give three months’ notice, attend a one-month pre-retirement workshop or seminar, and use the remaining period to reconcile service records and complete pension documentation.

See also  FG may cut salaries to reduce governance cost, says minister

“The so-called mandatory three-month pre-retirement leave has no basis in the Public Service Rules,” the circular reads.

“A retiring officer must give three months’ notice before the effective date of retirement. This is a notice requirement, not a leave entitlement.”

Walson-Jack noted that officers remain in active service throughout the notice period and are expected to continue performing their official duties unless they are attending an approved pre-retirement programme or are absent under existing leave provisions.

“PSR 120243 does not exempt retiring officers from official duties during the notice period, except where they are attending an approved pre-retirement workshop or seminar, or are otherwise authorised to be absent under extant leave rules,” Walson-Jack was quoted in the circular as saying.

She directed all MDAs to stop compelling retiring officers to vacate their positions before their official retirement dates.

Under the new directive, retiring officers are to continue discharging their responsibilities while participating in approved retirement programmes and completing all documentation required for pension processing.

See also  Court bars Chevron’s Chief Medical Director from ejecting wife from home

The head of service said the move is aimed at ensuring uniform implementation of the Public Service Rules across government institutions and preventing the loss of experienced personnel through premature disengagement.

The circular also directed permanent secretaries, directors-general, executive secretaries, chairpersons of statutory agencies, and chief executives of government organisations to ensure strict compliance.

The federal civil service retirement framework, governed by the Public Service Rules and the Pension Reform Act, requires officers to retire after 35 years of service or upon attaining the age of 60 years, whichever comes first.

The government said the clarification would help improve service delivery by allowing retiring officers to continue contributing their expertise until their official exit dates while completing the administrative processes required for retirement benefits.

Continue Reading

Trending News