Appeal Court to Resume Hearing on FG, Rivers VAT Case Tomorrow

Blessing Ibunge in Port Harcourt

The Court of Appeal sitting in Port Harcourt, Rivers State, will tomorrow resume hearing on the appeal filed by the Federal Inland Revenue Service (FIRS) against the ruling of a Federal High Court, which declared that the Rivers State Government, and not the FIRS, should collect Value Added Tax (VAT) and Personal Income Tax in the state.

Following FIRS’ appeal, the appellate court had on September 10 asked all parties to the suit to maintain the status quo.

The case started when the sequel to a suit filed by the Rivers State Government, Justice Stephen Pam of the Federal High Court in Port Harcourt on August 10, 2021, restrained the FIRS from collecting VAT and  Personal Income Tax in the state.

The FIRS had applied for a stay of execution, a request that was denied by the court, saying it would amount to the court sitting in appeal over its ruling.

But following a suit filed by the Attorney-General of the Federation and Minister of Justice, Mr Abubakar Malami, the Court of Appeal in Abuja issued an injunction that parties, including FIRS and Rivers and Lagos states, should maintain the status quo.

The court at its last sitting on September 30 referred the matter to the Port Harcourt division of the court for continuation of hearing.

Before then, the Lagos State Government, through its Attorney General and Commissioner for Justice, Moyosore Onigbanjo, had applied to be joined as a respondent in the appeal.

The presiding judge, Justice Haruna Tsammani, granted the appeal, noting that Lagos State was able to prove that it had a direct interest in the subject matter of the appeal.

The VAT issue had generated heated arguments across the country, with some analysts insisting that FIRS should continue to collect VAT while some said states should be allowed to collect it.

There have also been concerns over the prolonged delay in continuing the matter.

Northern states’ governors opposed states collecting VAT, while governors in the South had expressed support for states collecting VAT.

A senior official at the Appeal Court in Port Harcourt confirmed THISDAY that the appellate court would resume hearing on the matter tomorrow. THISDAY also gathered that the respective parties were asked to submit their written applications to the court ahead of the sitting.

Miffed by the decision of the Abuja Division of the Court of Appeal to issue an injunction that parties, including FIRS and Rivers and Lagos states, should maintain the status quo, the Rivers State Government had approached the Supreme Court to challenge the ruling.

The apex court is expected to give its verdict on the matter on May 27, 2022

Oyo State Government had also applied to be joined as a respondent in the appeal filed by the FIRS.