ONYEDI GABRIEL, Port Harcourt
Rivers State Governor has again defeated the Federal Inland Revenue Service (FIRS) at the Federal High Court sitting in Port Harcourt as the court dismissed an application to stop the state from enforcing an earlier judgement empowering it to collect the Value Added Tax (VAT).
The court presided over by Justice Stephen Pam had in a landmark judgement stopped FIRS from collecting VAT declaring that it was constitutionally within the jurisdiction of the state government to impose tax.
But FIRS approached the court through a motion on notice seeking a stay of execution of the judgment pending the determination of its suit at the Appeal Court.
Delivering judgement on the application for stay of execution, Justice Pam said any attempt to grant the reliefs sought by FIRS would negate the principle of equity.
Pam averred the court was bound to obey the Rivers State Value Added Tax Law No. 4, 2021, already enacted by the Rivers State House of Assembly conferring a legitimate right on the state government to collect VAT.
The judge said the law remained valid until it was set aside by a superior court of competent jurisdiction.
Following the judgement, Wike directed the Rivers State Revenue Service (RSRS) to immediately commence the collection of the Value Added Tax (VAT) in the state in line with the Rivers State Value Added Tax Law 2021
Wike said: “Consequently, I hereby direct the Rivers State Revenue Service (RSRS) to ensure the full and total implementation and enforcement of this law against all corporate bodies, business entities and individuals with immediate effect.
“All corporate bodies, business entities and individuals are advised to willingly, truthfully and promptly comply with their tax obligations under this law to avoid the full weight of the stipulated sanctions, including having their business premises sealed-up”.
The governor in a statewide broadcast lamented that without any stay of execution on the subsisting judgement, FIRS went about bullying corporate bodies and business entities from paying the VAT to the Rivers government even when “they knew that an appeal does not serve as a stay neither was there anything to stay in a declaratory judgement”.
He said: “However, being a government that believes in the rule of law we decided on our own to suspend the enforcement of the Rivers State VAT Law 2021 pending the outcome of the FIRS’s application for stay-of-execution.
“Today, the FIRS has failed in its attempt to frustrate the enforcement of the State’s Law on VAT with the Federal High Court’s dismissal of its application for stay-of-execution of the judgement.
“And with today’s judgement the way is now clear for the administration and enforcement of the Rivers State Value Added Tax Law 2021 across the entire State until otherwise decided and set aside by the Superior Courts.
“Let me warn that the Rivers State Government is fully in charge of the State and will not tolerate any further attempt by the FIRS to sabotage or undermine our authority to freely administer our tax and other related laws in our own State. Those who play with fire risks having their fingers burnt. Enough of the shenanigans.
“I wish to further assure every resident that we shall as usual make effective use of the expected proceeds from this tax to accelerate the development of our state and improve the wellbeing of everyone”.