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Kudos For Court Judgement On VAT

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If the recent judgement of a Federal High Court sitting in Port Harcourt, Rivers State, which held that
the Rivers State Government and not the Federal Inland Revenue Services (FIRS) was the rightful authority to collect Value-Added Tax (VAT) and Personal Income Tax (PIT) in the state is anything to go by, states will soon take charge of the money-spinning VAT and PIT in Nigeria.
That was the judgement of Justice Stephen Pam in a suit filed by the Rivers State Government challenging the right of the Federal Government to demand VAT and PIT. The state had asked the court to declare that the constitutional power of the Federal Government to impose taxes and duties was limited to items listed in items 58 and 59 of Part 1 of the Second Schedule of the 1999 Constitution (as amended).
Likewise, the state government had urged the court to declare that by the provisions of items 7 and 8 of Part II (Concurrent Legislative List) of the Second Schedule of the Constitution, the power of the Federal Government to delegate the collection of taxes can only be exercised by the state government or other authority of the state and no other person.
Also, the court was asked to declare that all statutory provisions made or purportedly made in the exercise of the legislative powers of the Federal Government, containing provisions inconsistent with the powers to impose tax and duties, as prescribed by items 58 and 59 of Part I of the Second Schedule of the 1999 Constitution, or inconsistent with the power to delegate the duty of collection of taxes, as contained in items 7 and 8 of Part II of the Second Schedule of the Constitution, are unconstitutional, null and void.
The court agreed with the state government that it was the state and not FIRS that is constitutionally entitled to impose taxes enforceable or collectable in its territory like consumption or sales tax, VAT, education and other taxes or levies, other than the taxes and duties specifically reserved for the Federal Government by items 58 and 59 of Part 1 of the Second Schedule of the 1999 Constitution as amended.
The implication of the ruling is that it is now illegal for taxes like VAT and PIT to be levied by any Federal Government agency in Rivers State. In other words, the issue of VAT in the territory of Rivers State and PIT should be reserved for the government of Rivers State. This is a welcome judgement. It was least imagined that a state could successfully contest the legality of VAT collection by the federal authorities in court. 
In 2014, the Lagos State Government lost a case filed at the Supreme Court challenging the powers of the Federal Government to collect VAT on goods and services supplied in the state. The state had sued the Federal Government seeking a ruling to repeal the VAT Act on the basis that it was outside the legislative remit of the federal authorities to collect the tax.  
The court, however, ruled in favour of the preliminary objection of the Attorney General of the Federation on behalf of the Federal Government that the Supreme Court lacked original jurisdiction in the matter as it was a dispute between a federal agency and Lagos State, not between the Federal and the Lagos State Governments. This was on the basis that VAT was collected by the FIRS which is a federal agency.
As the court rightly held, there is no law that authorises the Federal Government to demand or collect VAT or PIT in the country. That indicates a lot of illegality being perpetrated by the federal authorities. This should be resisted, in particular by state governors who are often victims of their arbitrariness. Governor Nyesom Wike’s action to seek interpretation of the law in this regard is commendable. These are the things that should have to be tested in the courts to allow Nigerians to know their legal status.
After many years of illegally collecting these taxes, it is comforting to know that states, not the Federal Government, are the legitimate authority to require them. The ruling will certainly address the injustice, anomalies and disparities in the generation and distribution of VAT funds across the 36 states and the Federal Capital Territory (FCT). VAT focuses on goods and services consumed by residents in a state like alcohol.
Most Northern states generate nothing in the sphere of alcohol VAT following existing Sharia laws, which prohibit the consumption of the product in the respective states. Logically, one would think and expect that the affected Northern states would be excluded from the receipts on alcohol VAT since they generate zero revenue from the sale and consumption of liquor and beers. 
But that is not the case. By the irrational suppositions and thoughts of the Federal Government, the Northern states participate in the sharing or distribution of VAT on alcohol. We find this offensive, unreasonable, iniquitous and unjust. Why would the Northern states benefit from the alcohol VAT with zero generation? To begin with, the court’s decision will eliminate the disparities in the country’s VAT administration.
There is a need to understand whether Nigeria is a federal or unitary state. Although the nation operates a federal constitution, in practice it functions as a unitary state, a consequence of the centralist tendencies that have come to characterise the system of government. The way federalism works in this country is not consistent with the basic tenets of the system. However, the judgment of the court shows that we are a federation, not a unitary state; so, the country should be governed as such.
If the court’s decision is upheld by the Supreme Court, it means that more money will accrue to Rivers State. That will equally mean more projects and a better life for people in the state. Consequently, the state government will need to be more accountable. Governor Wike must not let go of his advocacy in favour of the good governance of the country. That depicts him as the conscience of the nation.

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Sylvester’s Death: Let Justice Prevail

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Sylvester Oromoni was a Junior Secondary School (JSS) student of Dowen College in Lekki, Lagos State. He was 12-years old at the time of his demise. Reports that have been going viral from the family say that Sylvester was suspected to have been bullied by other students in the college which led to his death.
In a media report, his parents alleged that he was given a substance to drink by those who dealt with him. It was leant that five students were mentioned by the deceased to have been allegedly involved in giving him injuries before he died a week ago.
Dowen College, his former school, in a statement claimed that the deceased sustained injuries while playing football and was treated at the school’s sick bay. The college denied that he was not bullied by any student and said it had carried out a preliminary investigation that they claimed revealed that there was no case of bullying. The school also claimed that its policies were anti-cultism.
Dowen authorities should intensify efforts in unraveling those involved in the act if really the story is true. This is because no parent can be happy that after entrusting a child to a care giver, at the end of the day, that parent is told funny stories about the child.
Like the college claimed, if Sylvester had an injury from playing football and the school knew it could not handle the treatment properly, the parents should have been invited. Some of us have our wards in boarding schools and any situation that is above their care warrants parents’ attention, be it academic, health or social.
One of the reasons for choice of boarding schools for students is concentration and good moral upbringing as some of them can easily be distracted when they attend day schools.  When parents hand over their wards to schools, they expect good news at the end of the day.
It is unacceptable and shocking that a parent sends his or her child to a school while toiling day and night to raise school fees and it turns out to be a waste.  As far as secondary school education is concerned, no student should claim seniority to bully another, no matter the level of provocation.  Simply, reports should be sent to house masters and mothers to settle whenever there is misunderstanding between students, especially in the dormitories. College authorities have the right to correct erring students though mildly.
The level to which a school can handle a child’s problems is limited; otherwise when serious issues come up, parents should be asked to pick up the child for more care.
I wonder why cult activities should be allowed to take place in schools under the watch of school heads. There must be proper check on students’ activities in the dormitories from time to time to fish out those who are not serious with the mission of being in boarding schools.
If truly Sylvester was given a substance which may have peeled his lips and gone to the extent of destroying his internal organs, where were the house masters? If in a school block, what about the teachers? Wherever the students may find themselves within the school environment, there must be a staff responsible for their activities.
The Federal Ministry of Education, Lagos State Ministry of Education, Lagos State Universal Basic Education Board and all relevant stakeholders, including security agencies and civil society groups should ensure that the truth about what happened to Sylvester is made public. Every child has the right for social protection.
About a year ago, the case of Don Davies, a former student of Deeper Life High School, Uyo in Akwa Ibom State, came up although he never died. His case was also about bullying and malnutrition.
If Master Davies, for instance, was not taking care of himself and personal belongings, he shouldn’t have been handed over to the senior students. The housemaster should have invited the mother. There is no doubt that there are things a school cannot handle for the children.
You discover that some of the students, especially new intakes, find it difficult to cope in boarding schools being their first time of leaving home. When you talk about malnutrition, some of them walk sluggishly to the refectory and sometimes reject a particular meal due to some inexcusable reasons. The truth is that when a child continues to skip meals, he or she must look malnourished.
If the information released by the deceased’s father on the social media is anything to go by, that the late son was given a harmful substance to drink, how did the five students get that in school?
We are in a digital era, parents and care givers should put more efforts at checking the activities their children are involved in. Are there no CCTV cameras in that school?
It is a welcome development as the Lagos State Government has shut down Dowen College due to the death of Oromoni who was allegedly maltreated by his seniors while investigation into the cause of his demise continues.

Earlier in the year, a 14-year old female student of Premier Academy, Lugbe in Abuja, who died of sepsis, is another case that cannot be forgotten soon. In her case, a substance was allegedly found inside of her which nobody knew what or who was responsible for that. It was reported that she could not explain anything about that before she died. One may not also know whether it happened in school or at home.
Cases like these call for concern because each time they occurred, there won’t be good explanation concerning the ugly incidents. It is surprising that students under various schools watch will be suffering all manner of assaults that can lead to death.
Colleges should be able to give account of their students whether in boarding or day school.  Parents cannot continue to lose children in that manner. Children that would have been reared from infancy with high cost of education to the level where they can express themselves cannot be lost like that. Whenever similar incidents occur, thorough investigations should be carried out so that erring students can be punished to serve as deterrent to others.

Furthermore, there should be proper and regular monitoring and supervision of both public and private colleges, boarding or day in Nigeria by officials from both state and federal educational bodies; finding out the performance and attitudes in various schools. We are aware of attitudinal or behavioral change in students so it is important for relevant authorities to do the needful.

A lot of students may be suffering in silence since they may not be able to speak out, parents should always interview their wards especially the girl-child. We are talking about the ones that have been made public; there can be hidden ones which they may be apprehensive to speak about.

It is high time stringent measures were put in place by stakeholders in education to curb the menace of bullying, cultism and assault in our schools.

I am not debating whether boarding is better than day school, what we should be talking about first is consoling Sylvester’s parents.  Investigation should continue till the cause and those were involved are unraveled. If names have been mentioned, they should be interrogated with their parents, although their parents were not in the college when the ugly incident occurred.

In fact, from now, college authorities and care-givers must be aware of happenings in the dormitories. Parents are out there toiling to ensure school fees are available. Who said there is no bullying in day schools? Pray it shouldn’t happen to anyone.

Let’s stop here as investigation into what exactly happened to Sylvester continues.

By: Eunice Choko-Kayode

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Again, On VAT Collection

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The judgment by Justice Stephen Pam of the Federal High Court in Port Harcourt on the lawful authorities to collect Value Added Tax (VAT) and Personal Income Tax (PIT) has continued to provoke fundamental issues in our polity. The court had on August 8, this year, maintained that only the Rivers State Government and not the Federal Inland Revenue Service (FIRS) was authorised to collect VAT in the state.
Pam had afterwards dismissed FIRS’ application for a stay-of-execution, holding that granting it would invalidate the principle of fairness. That prompted the Rivers House of Assembly to pass a bill on VAT collection. Rivers State Governor, NyesomWike, has also assented to the bill, making now a law in the State. Lagos State has followed suit while many other states have initiated processes of making similar laws in their states.
This goes hand in hand with the fiscal federalism that Nigerians have been calling for all along. Obviously, the VAT law will contribute enormously to an increase in revenue and to the development of infrastructure in the states.
However, soon after the passage of the VAT legislation, a three-man panel of the Court of Appeal sitting in Abuja led by Justice HarunaTsammani, in an appeal filed by the FIRS, ordered all parties to maintain the status quo and refrain from acting in a way that would give effect to the VAT judgment of the Federal High Court. But the stay-of-execution order by the court was mucked up in contention, with some legal experts including Mike Ozekhome (SAN) interpreting it to mean that Rivers State still had the power to collect VAT until determined otherwise.
But in a fresh twist, the Rivers State Government has entered an appeal at the Supreme Court to challenge the order of the Court of Appeal in the VAT dispute between the state and the FIRS. In the suit instituted by a Senior Advocate of Nigeria (SAN), Emmanuel Ukala, alongside three other senior lawyers representing the government, the state is imploring the apex court to set aside the order of the Court of Appeal which directed it to maintain the status quo on the collection of the contentious VAT pending the determination of an appeal filed by the FIRS.
It must be observed that the impudence and impunity earlier demonstrated by the federal agency in compelling firms in the state to remit VAT to it despite losing out in an application for a stay at the High Court are disgusting and reproachable. That act or the thought of it was ill-advised and provocative. Indeed, if the state had followed suit in implementation of the State’s Law on VAT, it would have created a state of anarchy and those who like to blow up issues to paint the state in unsavoury terms to run it down and favour their paymasters would have had a field day.
We therefore salute Governor Nyesom Wike and the State Government for the restraint and maturity exhibited in this matter despite the obvious provocation. As a Federal Government agency, FIRS must constantly ensure that its operations are regulated by the rule of law. After all, Rivers State acted in its right to demand and collect VAT and approached the court for relief and got it. FIRS cannot determine what court order to obey or ignore.
As the feud exacerbates over the VAT collection, the Federal Government has similarly approached the Supreme Court for an ultimate resolution of the row. What is ambiguous in this latest action is whether the suit will not amount to an abuse of court process, as it is already before the Court of Appeal for determination. Also, it is doubtful whether the apex court will assume jurisdiction in the trial, since it had declined magistracy in a related matter between Lagos State and the Federal Government.
Lagos State had sued the Federal Government in 2014, seeking a ruling to repeal the VAT Act because it was outside the legislative remit of the federal authorities to collect the tax. The court, however, ruled in favour of the preliminary objection of the Attorney General of the Federation that the Supreme Court lacked original jurisdiction in the matter as it was a dispute between a federal agency and Lagos State and not between the government in Abuja and the Lagos State Government. This is on the basis that VAT is collected by the FIRS, a federal agency.
Again, it emerged recently that the House of Representatives was contemplating legislation that would further empower states to receive VAT and as well control the resources domiciled in their territory. The bill is titled “An Act to Alter Item 39, Part 1 of the Second Schedule of the 1999 Constitution as Amended to Substitute and Move the Item from the Exclusive Legislative List to the Concurrent Legislative List”, co-sponsored by Hassan Usman Sokodabo and John Dyegh. This move might upset the applecart, as it is bound to strengthen the states in their dispute with the Federal Government.
Just as the disputations rage with court litigation, we uphold the cutting-edge action of legislators from the House of Representatives to side with the states. We recall reported attempts by the Federal Government and its agents in the wake of the VAT controversy to smuggle a bill into the National Assembly to place VAT collection on the Exclusive List. Governors should therefore give countenance to their representatives in the National Assembly in their quest for states to be self-sustainable.
The arguments made in certain quarters that collection of VAT by the states will impoverish many others in the federation are insufficient and do not hold up. Rather, it will promote the establishment of a suitable fiscal federalism.
We believe that the Rivers State Government has a strong case in the current legal wrangling and will surely attain justice if the matter is well adjudicated. Since the essence of the disagreement is about equity, justice and fairness, we also expect that the final court decision on the issue will also enrich the country’s jurisprudence and reinforce how citizens understand and partner with the law.
Indeed, the most outstanding message from the VAT judgment is that the instrumentality of the law which Governor Nyesom Wike exploited can be applied to correct many of the hoarded and accumulated wrongs in our federal structure. The Federal High Court judgment already indicates that the Federal Government has been exercising powers it does not have.
It is patently erroneous that the federal authorities impose VAT on the same goods and services, upon which state authorities still demand ‘state tax’. We likewise think as it is in diverse climes, that the tax on consumption which VAT represents cannot be collected by the Federal Government. We equally question the justification for distributing the proceeds of VAT generated from the sales of alcohol with states that have not only prohibited its consumption, but wilfully obliterate the products.
While we deplore the infinite recourse to ethnic baiting by those who define every question in North-South rhetoric, and perhaps, muddling the waters on the VAT judgment, this is the moment for the FIRS to turn on its thinking cap on how to cope with declining revenues beyond battling for every crumb with the states. The lesson the government in Abuja ought to learn from the reactions to the VAT judgment is any tax system that fails to meet the twin stipulations of efficiency and equity in a disparate nation such as Nigeria cannot survive.

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WDP: Underscoring Importance Of Harmony

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On September 21 each year, the International Day of Peace is celebrated globally. Also known as the
World Day of Peace, the occasion aims to crystallize peace among nations by regularly observing non-violence and ceasefire. It is a time devoted to facilitating international support for building a rhythmic and viable world. Besides living in peace, the day is intended to motivate individuals and nations to recognise the full puissance of global unity.
The 2021 theme for the International Day of Peace is “Recovering Better for an Equitable and Sustainable World”. The objective is to help everyone to recover better, transform the world into a place that is more proportional, healthier, sustainable and just.
Lately, there has been a reanimation of prejudice, hostility and stigma all over the world that has taken more lives rather than preserve them. As the world recovers from the Covid-19 pandemic, the day presents the occasion to reflect on how to encourage everyone to recoup better, bolster resilience, and revolutionise the world into one that is more equal, just, equitable, inclusive, sustainable, and stronger.
The pandemic is especially affecting underprivileged and marginalised groups. It was reported that by April 2021, over 687million doses of Covid-19 vaccine had been administered worldwide, but over 100 countries had not received a single dose. Those caught up in conflicts are particularly unlikely to have access to health care.
Moreover, while reinforcing harmony among countries, we must make peace with nature. This is because climate modification is not on recess and the demand for the moment is to evolve a green and sustainable global economy that provides jobs, reduces greenhouse gas emissions, and inculcates resilience to the ever-increasing climate impacts.
In line with the UN Secretary-General’s demand for a global ceasefire, in February 2021, the Security Council reached a resolution calling for member-states to uphold a “sustained humanitarian pause” to local conflicts. It is crucial to abide by the call for the global ceasefire to ensure that those caught in conflict have access to life-saving vaccines and medicines.
In 1981, the United Nations General Assembly (UNGA) designated the third Tuesday in September as World Day of Peace. This was the first day of the regular session of the General Assembly. Subsequently, in 2001, September 21 was proclaimed the International Day of Peace. This is a day to lull, reflect and consider the best way to break the vicious circle of violence that conflict produces.
As the world commemorated last Tuesday, the giant of Africa, sadly, continues to wade through a series of crises that have diminished the level of peace in the country. According to the 2018 Global Peace Index (GPI), the nation ranks 148th out of 163 countries in the global ranking for peace. The GPI, which is the world’s leading measure of global peacefulness, assesses the state of peace using three thematic domains: the level of societal safety and security; the extent of ongoing domestic and global conflict; and the extent of militarisation.
Besides Cape Verde, Nigeria is the least peaceful nation in West Africa. In the 44 countries in sub-Saharan Africa identified in the report, Nigeria ranks 40th. This makes it one of the five least peaceful nations on the continent. Also, the Boko Haram insurrection, which began in 2009, has led to massive displacements of people in the North-East of the country.
Aside from the Boko Haram/ISWAP insurgency, intense disputes between farmers and herders have killed many Nigerians and displaced a record number of persons, especially in the North-Central. According to the Global Terrorism Index (GTI), Fulani herdsmen undertook more assaults and were answerable for more deaths than Boko Haram in 2016. Both lethal groups are the most considerable security threats Nigeria has faced over the years.
Political, ethnic, and religious divide renders Nigeria’s institutions ineffectual in handling crises such as violence, poverty, family disintegration, and widespread corruption. We need to cultivate optimism as a people with a common objective of tranquility. Time has come for the government and Nigerians to work together to find lasting solutions to these issues to build a stronger nation for posterity.
Nigerians should ignore divisive comments and embrace peace for the good of the country. We must make sacrifices as the nation recovers from the challenges that stand in the way of stability. No nation can flourish and realise its full potential in the midst of conflict; therefore, Nigeria needs to be put first for progress and advancement. This is the moment to unite to build effective and inclusive institutions.
This year’s International Peace Day is a keepsake to the Nigerian government at all levels to intensify efforts in combating insecurity and create enabling environments through good governance for socio-economic growth and expansion, economic opportunities and poverty alleviation. This will positively ensure an enduring cordiality and peaceful cohabitation among all tribes and persons in the country.
Here in Rivers State, the significance of peace cannot be overemphasised, as according to the Deputy Governor, Dr Ipalibo Harry Banigo, “Progress and development cannot thrive in an atmosphere of bitterness and rancour. It, therefore, behoves on all residents to keep the peace at all times to fast track the development agenda of the Governor Nyesom Wike-led administration.” In her Goodwill Message to mark the day, Banigo reiterated the need for all residents in the state to live peacefully with their neighbours in order to attract more development projects to all nooks and crannies of the state.
We note that since the inception of the Wike-led government in 2015, issues of communal clashes triggered by land boundary disputes have drastically reduced, and the State Boundary Commission has adjudicated on a number of volatile land boundary disagreements, which have engendered peace in communities. Besides, the government has partnered with community leaders, including traditional rulers, women and youth leaders, and community development committees (CDCs) to drive peace and harmony in communities as a cardinal ingredient of governance.
For us, the present administration has done so much to promote peace and unity. It is, therefore, essential that all residents of the state join hands with the government to sustain the peace so that recovery from the pandemic can be faster, and the resilience to build a better, stronger state in line with the NEW Rivers Vision achieved.

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