Justice Stephen Pam of the Federal High Court sitting in Port Harcourt yesterday dismissed an application by the Federal Inland Revenue Service (FIRS) seeking to stop the Rivers State Government from collecting Value Added Tax (VAT) in line with an earlier judgement in favour of the state.
The judge held that granting the application would negate the principle of equity.
According to ThisDay, the FIRS had in a suit marked FHC/PHC/149/2021 approached the court seeking a stay of execution of an earlier judgement of the court that stopped the agency from collecting VAT and held that it was constitutionally the role of state governments.
The FIRS had following the judgement against it requested the court to stop the Rivers State government from executing the ruling.
Pam stated that in as much as the state government and the state legislature had enacted a law with respect to VAT, the courts were bound to obey such law. He said the state government and the House of Assembly had duly enacted the Rivers State Value Added Tax No. 4, 2021, which makes it a legitimate right of the state to collect VAT.
The judge maintained that the law remained valid until it had been set aside by a court of competent jurisdiction.
Pam further said granting the prayers of the FIRS would amount to committing murder.
He noted that the prayers could not stand and, hence, dismissed them.
Reacting to the ruling, the governor of Rivers State, Mr. Nyesom Wike warned the FIRS against sabotaging the authority of the state to freely administer the VAT in line with the court ruling.
In a state broadcast in Port Harcourt, the governor alleged that the FIRS was bullying corporate bodies and business entities in the state for refusing to pay VAT to the federal agency.
He said Rivers State would not allow further collection of VAT from corporate bodies and businesses operating in the state by the federal government agency.
The governor argued that the FIRS 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.
