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VAT Controversy: Senior lawyers tackle Malami over claim on FIRS exclusive powers

Some senior Nigerian lawyers have faulted the Attorney General of the Federation and Minister of Justice, Abubakar Malami (SAN), over his recent statement on the collection of Value Add Tax (VAT).

Chief Mike Ozekhome (SAN), and Ifedayo Adedipe (SAN), in their comments, disagreed with Malami on his statement.

Ozekhome said contrary to Malami’s claim, VAT is in the residual list, and is strictly within the purview of state governments.

He said: “He (Malami) is dead wrong. There is nowhere VAT is reflected as a matter within the exclusive or concurrent list in the Constitution of Nigeria.

“If anything, it is residual and is strictly within the purview of state government in our federal set-up.

“As of today, there is a judicial pronouncement on it by the Federal High Court, Port Harcourt, to the effect that only states can collect and administer VAT.

“That remains the legal position today. Until that judgment is probably set aside, that remains the law of the land. The mere statement of the Attorney General cannot alter this truism.”

On his part, Adedipe warned that VAT is a serious constitutional issue and should not be politicised.

He said: “Is this in the 1999 Constitution or a new one? Which number or section? Let him state it. It is not enough to say it.

“I am not aware that VAT is on any exclusive list of the Constitution of the Federal Republic of Nigeria.

“Second, he is a defendant in the case, he should come to the court to come and put this across. It is not something he should give a press statement or side comments about.

“It is a very serious constitutional issue and therefore should not be politicised. Since we are before the appellate court, let us leave it there.”

Malami, in an interview with Channels Television on Friday, said collection of VAT in the country was on the exclusive legislative list, adding that only the National Assembly had the power to make laws on VAT.

He stated: “As you rightly know, the issue of the Value Added Tax is an issue on the exclusive legislative list. And the implication of being on exclusive legislative list matter is that only the National Assembly can legislate on it.

“The question that you may perhaps wish to address your mind on is whether there exists any national legislation that has conferred the power on the state to collect VAT. And my answer is ‘no’.

The Federal High Court sitting in Port Harcourt had in a judgment last month held that Rivers State had the power to collect VAT within its jurisdiction.

But the Federal Inland Revenue Service headed for the Court of Appeal to challenge the judgment. At the appeal court, Lagos State filed an application that it should be joined with Rivers State as a co-defendant in the appeal filed by the FIRS.

The Appeal Court ordered parties in the suit to maintain status quo pending the determination of the appeal.

 

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