The Court of Appeal in Abuja today stopped Rivers and Lagos State Governments from collecting Value Added Taxes (VAT). Specifically, the appellate court halted the Rivers State government from collecting VAT until all legal disputes relating to the matter are resolved. The court ordered that the judgment of the state high court from which the state drew authorities to collect the tax must not be implemented.

Justice Haruna Simon Tsanami who issued the order also directed that the law passed by Rivers State House of Assembly and assented to by Governor Nyesom Ezenwo Wike must not be implemented. The appellate court held that since parties have submitted themselves to the authorities of the court for adjudication of the matter, they must not do anything that will destroy the subject matter of the appeal.

In specific terms, Justice Tsanami granted status quo ante in favour of the Federal Inland Revenue Services FIRS and against the respondents. He slated the matter for September 16 for a hearing of the motion for joinder by Lagos State.

FIRS, in an appeal marked CA/PH/282/2021, is praying the court to set aside the judgment of a Rivers State High Court which granted powers to the state to collect Value Added Tax, VAT.

On August 9, 2021, the federal high court sitting in Port Harcourt ruled that the Federal Inland Revenue Service (FIRS) - the agency responsible for assessing, collecting, and accounting for tax and other revenues accruing to the Federal Government of Nigeria - should stop collecting value-added tax (VAT) and personal income tax (PIT) in Rivers state. It directed the Rivers state government to take charge of the collection. (1)

Following the Port Harcourt court judgment on VAT, the Lagos State House of Assembly, yesterday, passed the state’s VAT bill and the bill that prohibits open cattle grazing into law.

The VAT war took a new twist when the 36 states of the federation, through their Attorneys-General, yesterday dragged the Federal Government to the Supreme Court over alleged failure to remit funds generated from stamp duties into state accounts.

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