The federal government has considered an out-of-court settlement of the legal tussle between the Federal Inland Revenue Service (FIRS) on the one hand and Rivers and Lagos states on the other over the collection of value added tax.
The minister of finance, budget and national planning, Mrs. Zainab Ahmed gave the hint on Channels Television’s ‘Politics Today’ programme.
She said efforts were ongoing on the issue but she did not give details as the matter was subjudice.
She said she hoped there would be a political solution to the issue rather than a protracted court case.
“I’m not supposed to be talking about issues in court but I do hope that this problem can be solved by sitting on the table; not on the pages of newspaper or disagreements in court because it is possible to solve it on the table, talking of political solution,” she said.
On whether the federal government or its representatives had reached out to the governors on the matter, she said: “There are a lot of efforts going on right now. As I said, I don’t want to discuss it because it’s in court so I have to be careful. But there will be a positive political solution. We are working towards an out-of-court solution.”
Recall that a Federal High Court in Port Harcourt, Rivers State had on August 9 ruled that Rivers State and not the FIRS should be the authority collecting VAT and Personal Income Tax in the state.
The FIRS appealed the ruling and at the Appealed Court in Abuja and also wrote to the Senate to seek the inclusion of VAT collection in the exclusive legislative list.
However, it failed to obtain a stay of execution it sought from the appellate court to prevent the state government from enforcing the verdict following which the Rivers State government enacted a law to empower the state to collect VAT.
The governor, Nyesom Wike, signed the bill into law on August 19.
Lagos State, whose request for joinder as a respondent in the suit before the Court of Appeal was also granted by the court, also enacted its own VAT law. The governor, Babajide Sanwo-Olu, signed the bill into law on September 10.
However, after approving Lagos State’s request for joinder as a party at the Court of Appeal, ordered all parties to maintain the status quo on the matter, a ruling the Rivers State government had approached the Supreme Court to set aside.
The Court of Appeal also directed that the matter be moved from Abuja to its Port Harcourt Division for further hearing.
The court has yet to decide on the substantive suit as of the time of filing this report.
With Punch report
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