In furtherance to a publication by TheCable, recent information has indicated that the Governor of Rivers state, Nyesom Wike is allegedly making deft moves to ensure that the legal battle over the collection of Value-added Tax (VAT) in the Supreme court goes in his favor.
It can be recalled that the Rivers state government has been in court with the Federal Inland Revenue Service for some months now.
On August 10th, a federal high court in Rivers state ruled that the Rivers State Government (RSG) and not the Federal Inland Revenue Services (FIRS) that should collect 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 FIRS 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.
The FIRS responded by heading to a court of appeal stating that it was the exclusive right of the agency to collect VAT in the country.
On September 10th, an Appeal Court sitting in Abuja suspended the operation of the law passed by the Rivers State House of Assembly and assented to by Governor Nyesom Wike, for the collection of VAT by the State government. The court held that since parties had submitted themselves to the jurisdiction of the court for adjudication on the issue, they must not do anything that will destroy the subject matter of the appeal.
The court granted ‘status quo ante bellum’ in favour of the Federal Inland Revenue Service (FIRS) and against the respondents.
Under the current practice, VAT is collected on behalf of the federation by the Federal Inland Revenue Service (FIRS), with states getting 30 percent derivation. Rivers, Lagos and Ogun states enacted laws to enforce the judgment, but the appeal court asked them to stay action until the appeal, filed by the FIRS, is determined.
Unhappy with the appeal court ruling, The Rivers state Government approached the nation’s Apex court, the Supreme court to set aside the ruling of the appellate court on grounds that the lower court erred in ordering status after it earlier held that the application for joinder by Lagos State must be heard first before the motion for stay and interlocutory injunction by the FIRS.
The appellant maintained that the appellate court lacks the powers to set aside its own judgment, which held that the Lagos application for joinder must be taken before any other application.
They further argued that ordering ‘status quo ante bellum’ amounts to granting the reliefs being sought by the FIRS, when the main application has not been heard and determined.
However, Reliable sources reveal that a plan is already in motion to ensure that the Chief Justice of the Nation, Ibrahim Tanko Muhammad proceeds on trip to the United Kingdom before a panel is constituted to determine the appeal.
If the CJN eventually proceeds on this trip, The appointment of a 7-man panel to preside over the case will be left in the hands of second highest in the supreme court hierarchy and former first lady of Rivers state, Mary Odili.
Mary Odili is married to Ex-Rivers Governor, Peter Odili who also happens to be a Political leader and family friend of the current state governor, Nyesom Wike. It’s common knowledge not that the CJN fell seriously ill from COVID-19 last year. He was flown to Dubai for treatment and has not been too active since then.