ONYEDI GABRIEL Port Harcourt
Rivers State Governor Nyesom Wike has explained that the Lagos State Government first commenced the legal battle to enable states exercise their constitutional rights of collecting the Value Added Tax (VAT) but failed because of some pitfalls in its suit.
Wike spoke on Monday when the Managing Director and Editor-in-Chief of the SUN (Newspaper) Publishing Limited, Mr. Onuoha Ukeh led a delegation to present a letter nominating him as the SUN Man of the Year 2020 Award at Government House, Port Harcourt.
He said Lagos first dragged the Federal Government to the Supreme Court, but was denied judgement on technical grounds.
He said Rivers State only avoided the pitfall of Lagos by suing the Federal Inland Revenue Service (FIRS), an agency of the Federal Government that was collecting the tax in the state.
He said: “The issue of VAT did not start from Rivers State alone. It started in Lagos State when Lagos State challenged it in Supreme Court. Unfortunately, the Supreme Court said you (Lagos) shouldn’t have sued the Federal Government. All you would have done was to sue the agency”.
He said Nigeria must encourage federating states to harness their resources and generate revenues, including VAT to advance their development.
The governor flayed some public commentators including some state governors for not considering the legality of states to collect VAT in their analysis and opinions, saying they were politicising the matter and looking at it from the prism of ethnicity and religion.
Wike insisted that what the FIRS was doing was illegal and could be likened to robbing the states.
He said: “You don’t even need to be a lawyer to know that VAT is not in item 58 and 59 of the second schedule of the 1999 Constitution as amended. Everybody knows that. It is not even in the concurrent list. Therefore, it falls under the residual list. It is not arguable. That yesterday nothing happens does not mean that today nothing will happen, or tomorrow something will not happen.
“Nigeria should encourage states to be strong enough to have resources to develop their states. we are in a federal system where we are practicing unitary system. Everybody at the end of the month will run to Abuja to share money. Nobody comes back to the state to think, how do I develop my state?”
The governor said rather than commend Rivers government for seeking entrenchment of fiscal federalism and constitutionalism, a particular state governor had threatened that the judgement of the court would not stand.
He urged those demanding a brothers’ keeper consideration to first appreciate the position of the law and situate it rightly.
He said: “Some people say, be your brother’s keeper. I have no problem in being my brother’s keeper but why not come out and say, let us tell ourselves the simple truth. As it is being provided in the law, who is the person responsible to collect the VAT.
“When you agree that it is the state, then we can sit down to look at the different problems of states. And not to say be your brother’s keeper while you’re doing an illegal thing, in disobeying what the law says you should not do.”
On the new loan, Wike said it was sheer act of discrimination for the Federal Government not to include Rivers State as one of the states that would benefit from the foreign loan’s projects.
He said: “Look at the money that Federal Government has gone to borrow from the World Bank. Of all the projects, in all the states, Federal Government did not include Rivers State.
“Look at the list of projects that states will benefit from this money they’re borrowing from the World Bank, that they have sent to National Assembly for approval, the only states that is not benefitting is Rivers State.
“It is the prerogative of Mr. President; if he says he does not like Rivers State, if the ruling party says they don’t like Rivers State, I won’t kill myself. But leave the one that the law says I should be the one to collect so that I will be able to develop my own state.”
Wike explained that beyond the provision of infrastructure, his administration was a law that would provide comfortable accommodation for judicial officers on retirement.
He said the move was to ensure that while in service, the judicial officers could concentrate on their jobs without cutting corners and avoid corrupt practices.
In his remarks, Ukeh said the SUN Man of the Year 2020 Award remained the flagship of award of the company.
He said Wike was unanimously selected for his remarkable contributions to the socioeconomic development of Nigeria and promotion of fiscal federalism with his position on VAT, which would help in the restructuring of Nigeria.
He said: “Today, His Excellency has guided Nigeria to true federalism with the issue on VAT. Knowing what fiscal federalism should be His Excellency went to court to challenge the collection of VAT and the Court stated that actually the States should collect VAT. And that is laying the foundation for true federalism and fiscal federalism.”
Ukeh commended Wike for his performance in office and infrastructural revolution taking place in Rivers State.