MAN, NECA, NACCIMA to FG: Clear the Confusion over VAT Now

Dike Onwuamaeze

The leaders of the Organised Private Sector of Nigeria (OPSN), yesterday, spoke in one voice to the federal government urging it to make a statement that would clear the confusion trailing the proper government that should collect the Value Added Tax (VAT) in the country before or on September 21.

They said that the reality and consequences of the controversy portend grave danger for the business community and by extension the fragile economic recovery the country has been witnessing in recent times.

The OPSN, which is comprised the Manufacturers Association of Nigeria (MAN), Nigeria Employers’ Consultative Association (NECA), and the Nigeria Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), the Nigeria Association of Small Scale Industries (NASSI) and the Nigeria Association of Small and Medium Enterprises (NASMEs), said during a press conference yesterday in Lagos that a statement from the federal government would give a clear direction to the business community that would save them the dilemma of remitting their VAT to the wrong government that would necessitate double payment; it would also save them the consequence of paying penalty fees for withholding the remittance of their VAT beyond the due date of Tuesday, September 21, 2021.

The Chairman of the OPSN, Mr. Taiwo Adeniyi, said: “The confusion in the public space is why we have called this press conference. It is the reason we are shouting that the government should come to our aid.”

We want to pay the VAT. But it is for the government at the centre to make a pronouncement because we do not want the situation where we will pay the VAT to the Federal Inland Revenue Services (FIRS) and the court will later say that it is state governments that shall collect VAT.

“Remittances for VAT will be made where applicable on September 21. The penalty starts counting from September 22. We are shouting that the government will give us a direction as to what to do. It is not even late as a pronouncement can be made on Tuesday, September 21.

“We know that our government listens and we hope that before September 21 this matter will somehow be resolved. The Appeal Court has said that the status quo remains. But we are asking a question: ‘What does ‘status quo remains’ mean in the context of where we have found ourselves?’ It is a whole lot of confusion and we are asking the government to protect us against all of these by letting us know what to do.

“We are speaking out for government to realise the magnitude of what is on the ground. Somebody needs to interpret for us otherwise, it will be a whole lot of mess.”

Adeniyi said that the OPSN is seriously concerned about the consequences of the ongoing controversy over the right of the government to collect VAT in the country, adding that it would be an “aberration to punish businesses or make them suffer from the proverbial ‘two elephants fighting.”

“It is our opinion that the conundrum be addressed timely as delay can have a negative effect on businesses, most especially in collection and remittance of VAT to the relevant authority.”

He said that the ongoing situation had created an environment of uncertainty, which would negatively affect business competitiveness and sustainability in the country.

The federal government, through the FIRS by virtue of the Value Added Tax Act of 1993, has been the sole collecting authority of VAT in Nigeria until the Rivers State Government won a judgment at the Federal High Court, Port Harcourt, which empowered it to collect VAT from businesses located in Rivers State.

The controversy was heightened by two recent developments that include the enactment of VAT law by the Lagos State Government that vested the power to collect VAT in Lagos State on the state government as well as the statement by the southern governors on Thursday in Enugu that state governments should be the right authorities to collect VAT in their respective jurisdictions.

Now, the controversy is the subject of litigation at the Appeal Court, Abuja Division, and the Supreme Court of Nigeria.