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OPINION: What The Court Is Doing That Is Affecting Wike And Sanwo-Olu On The VAT Tussle Against FG

Nigerians are curiously waiting to see how the case of Value Added Tax (VAT) will be settled as the court is expected to deliver judgment on the issue.

Sanwo-Olu ignores Appeal Court order as Lagos goes ahead to collect VAT

Image credit: Peoples Gazette

The bone of contention is the issue of who should collect the VAT. Is it legal for the federal government to collect VAT from states or is it the legal right of each state to collect VAT in its territory? This is the issue at stake. While Wike and Sanwo-Olu believe that it is their right to collect VAT from Rivers and Lagos States respectively, the federal government led by President Muhammadu Buhari think otherwise as it believes that it has the legal right to collect the VAT. That was why the issue is pending before the Court of Appeal as the parties wait for it to give its verdict. But, there is something the court is doing that is somehow affecting Wike and Sanwo-Olu.

What is that?

The Court is delaying. By this, the implemetation of the VAT laws signed by Wike and Sanwo-Olu is being affected. There are different instances to support the fact that the court is delaying the process. According to a report by The Punch, Wike and Sanwo-Olu made a smart move by heading to the Supreme Court since the Court of Appeal is delaying as it has not delivered judgment. Yet, the Supreme Court seems to be doing the same things. More details will be given to explain further.

Image credit: The Guardian

The Court of Appeal had granted the stay of execution sought by the federal government through the Federal Inland Revenue Service (FIRS). By that order, the Court of Appeal automatically stopped Wike and Sanwo-Olu from collecting VAT starting from this month of September as they had planned. That will work against the interest of the two top revenue generating states in Nigeria (Lagos and Rivers). That being done, Wike and Sanwo-Olu expected that the Court of Appeal would give the suit a quicker attention and deliver judgment after it fixed September 16 for hearing. But, that did not happen.

Image credit: BBC

There is another scenario that show that the court is somehow delaying judgment which is affecting Wike and Sanwo-Olu as they are prevented from collecting VAT. This one is based on the reality on ground after Wike and Sanwo-Olu approached the Supreme Court. The report cited above revealed that the appeal by the two Governors against the federal government has not been assigned to a panel that will handle it despite the fact that it was filed on September 13th, 2021.

Image credit: The Guardian

Meanwhile, Ahuraka Isah who is an aide to the Chief Justice of Nigeria, Muhammad Tanko, confirmed that the appeal was not listed for hearing this week. He added that he does not know if the panel that will hear it has been constituted. From all indications, the appeal is also being delayed at the Supreme Court which will still mean that Wike and Sanwo-Olu will be barred from collecting VAT while the delay lasts in both the Court of Appeal and the Supreme Court.

VAT Collection: Sanwo-Olu Backs Wike After Triumph In Court

Image credit: Newsrand

Individuals and businesses are confused on who to pay VAT to in Lagos and Rivers states. Should they pay to the state or the federal government as this controversy and legal battle linger? This is the confusion and dilemma they are faced with. This may result in VAT shortfalls or even loss of some revenue.

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Court of Appeal Nigerians Peoples Gazette Sanwo-Olu Wike


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