OPS wants FG’s directive over VAT payment

*Says delay in addressing the issue could cause negative effect on businesses

*FIRS push for amendment of VAT Act will fail – Gov Akeredolu

Motolani Oseni, Lagos and Stephen Gbadamosi, Ibadan

Following the controversy that has trailed the collection of Value Added Tax (VAT), the Organised Private Sector of Nigeria (OPSN) has urged the Federal Government to urgently make a pronouncement on the ongoing disagreement over VAT payment.

Just recently, the Federal High Court had ruled that it was not the duty of the Federal Government to collect the tax.

But the OPSON which comprises the Manufacturers Association of Nigeria, the Nigeria Association of Chambers of Commerce, Industry, Mines and Agriculture, Nigeria Employers Consultative Association (NECA), Nigeria Association of Small Scale Industries and the Nigeria Association of Small and Medium Enterprises, on Sunday gathered in Lagos to call on the Federal Government to urgently make a directive to enable businesses to know what to do.

OPSN chairman, Mr. Taiwo Adeniyi, made the call at a news conference and said delays in addressing the issue could cause negative effects on businesses, most especially in the collection and remittances of VAT.

“We are aware that by September 21 we get penalised if we do not pay or remit the VAT for August.

“We are also aware that laws are not made in retrospect. It then means that even if those laws have been enacted, particularly the Lagos State law which came into effect in September, it will not affect the payment by businesses in the state.

“Due to our remittances, we have issues with the fact that the law for Rivers was made in August and the majority of the businesses in Lagos usually will have a relationship with the Rivers State Inland Revenue too.

“The confusion in the public space is the reason we are calling on the government to come to our aid as we want to pay.

“It is for the government at the centre to make a pronouncement as to what becomes of us,’’ he said.

Adeniyi, who is also the President of Nigeria Employers Consultative Association (NECA), said that the ongoing challenge had the potential to make businesses pay double VAT given demands by the FIRS and state governments.

He said that businesses, as the collecting agents, were practically unclear on the authority to remit to and without a clear path, this would further aggravate the pain on businesses.

“It is a popular saying that where two elephants fight, it is the grass that suffers.

“It is no longer news that Nigerian businesses have been battling with myriads of challenges, making the survival of enterprises and ease of doing business in the country among the worst in this part of the world,’’ he said.

It is, however, worthy of note that VAT is normally collected by the Federal Government since the military era and the money is shared by the three tiers of government.

Following the court ruling, however, Lagos and Rivers states passed laws that allowed them to collect VAT.

FIRS, which used to collect the VAT on behalf of the Federal Government, has challenged the court ruling at the appellate court.

Meanwhile, Chairman of the Southern Nigeria Governors’ Forum and Ondo State Governor, Oluwarotimi Akeredolu, SAN, has said the amendments sought by the Federal Inland Revenue Service (FIRS) at the National Assembly to the controversial Value Added Tax (VAT) law will be killed at the States’ Houses of Assembly.

Governor Akeredolu said the law did not give power to the Federal Government to collect VAT and share to the states.

He explained that it was the state governments that had the power to collect the tax.

“That’s the position of the law. The FIRS seeking for amendment is a confirmation that they don’t have the power. The amendment will be dead on arrival. Why seek an amendment to a constitution when the provision is so clear?” Akeredolu asked.

The governor spoke on ‘Arise TV Sunday Talk Show’ hosted by Reuben Abati.

Governor Akeredolu insisted that if the Federal Government was to collect VAT for states, it could only get a percentage which it could decide to share at the Federation Accounts Allocation Committee (FAAC).

He said: “You can only collect VAT on behalf of the states and hand their money over to them. You can only take a percentage there for helping us to collect the money.”

On the controversy over the Petroleum Industry Bill (PIB), Governor Akeredolu said the Southern Governors’ Forum aligned and agreed with the position and steps taken by the Nigeria Governors’ Forum to pursue the amendment to the Bill so as to reflect equity, justice and fairness.

The governor said his visit to the former Lagos State governor and National Leader of the All Progressives Congress (APC), Bola Tinubu, in London had nothing to do with the 2023 election, adding that the rumours doing the rounds on the social media were untrue.

Governor Akeredolu, who described Tinubu as the political ‘capo’ in the South, said the former Lagos governor was expected to return to the country soon so as to meet with him and take certain critical decisions.

Asked if he would support Tinubu as presidential candidate of the party in 2023, Governor Akeredolu said: “APC is a party. APC will decide who the candidate will be. I have said it several times, I’m going nowhere. If I leave APC, I am going back to my chamber. For me, whatever APC decides, I will follow.

“We went to London because it was important for us to go and see for ourselves how he’s doing. He’s the capo for us here. By the time he comes, we can make some serious decisions.”

Asked whether he had not breached the constitution with the appointment of four commissioners and few special advisers since his inauguration for a second term in office in February, Governor Akeredolu said the decision on the number of commissioners to be appointed lay with him.

He said: “There is no provision that says what number. Only the Attorney-General and Commissioner for Justice is stated there. The number of who will work with me will be decided by me.

“Come early next month, we will have more commissioners. I’m to determine the number of commissioners that I will want to work with.

Governor Agagu worked with less than 11 commissioners. I’m not saying it is ideal.

“I will have to put in more people come next month. But it can’t be as many as it was in the first term because the finance of the state is badly affected.”