The Lagos State Government will implement the value added tax (VAT) law despite a subsisting order by the appeal court.
A member of the Lagos State House of Assembly Setonji David stated this during his appearance on Channels Television on Monday.
Until the court gave orders to the contrary, the lawmaker said nothing should stop the implementation of the law since it had been enacted.
He lamented that despite generating the country’s largest percentage of VAT, Lagos only got a paltry 10 per cent, which he said was unfair to the state and its infrastructural development.
“The status quo is that we have enacted the law in Lagos and the law is in existent and I believe strongly that until another judgement is passed by the Court of Appeal to the extent that what we have done is wrong, the law subsists.” he said.
“By our own understanding, what subsists in Lagos is our own law, until that law is set aside by the Court of Appeal. So, as far as Lagos is concerned, VAT in Lagos will be collected by the Lagos State Government.
“We generate over 55 per cent of the VAT in Nigeria and we get a paltry sum of 10 per cent. Is that fair for a population of over 24 million? We are happy that the Rivers State Government went to court and the court was very clear that VAT was supposed to be a state affair. We have no choice but to follow suit.”
He noted that Lagos State had always agitated for fiscal and true federalism that would guarantee the utilisation of revenues generated from sources such as VAT to be retained in states for their uses and benefits.
David stated that the Lagos Internal Revenue Service was well-placed and equipped to collect VAT, adding that it was the state that assisted the Federal Inland Revenue Service (FIRS) in developing its VAT collection through the deployment of its personnel to Abuja.
“In Lagos State, we have always clamoured for true federalism. This is consumption tax from the people of Lagos and it should be domiciled in Lagos and used for the people of Lagos. There are so many hassles that have to do with federalism that we are practising.”
The issue of VAT has dominated the political landscape after a Port Harcourt Federal High Court ruled last month that the Rivers State government had the powers to collect VAT within its territory.
In response, through its house of assembly, Rivers State enacted the state VAT law and immediately expressed its readiness to enforce the judgment beginning from this month.
Last week, the Lagos State followed suit by enacting and signing the state VAT bill into Law.
The state went further by asking it be joined with Rivers State as a co-defendant in an appeal filed by the FIRS against the Federal High Court judgement, before an Abuja Court of Appeal ruled that all parties in the matter should maintain status quo.
The case was adjourned till September 16 for a hearing.