The Rivers State Governor, Chief Nyesom Wike, has signed into law bills on Value Added Tax (VAT) collection, Open Grazing Prohibition in Rivers State.
He maintained that the judgement of the Federal High Court sitting in Port Harcourt had sufficiently addressed the illegality perpetrated by the Federal Inland Revenue Services (FIRS) on behalf of the Federal Government in the collection of VAT in states.
The governor stated this at the Government House, Port Harcourt, shortly after signing into law yesterday, the Valued Added Tax Law No. 4 of 2021; the Open Rearing and Grazing Prohibition Law No 5 of 2021; the Child’s Rights Amendment Law No 2 of 2021; the Residents’ Registration Agency Law No 6 of 2021; and the Naming and Renaming of Infrastructure Law No 3 of 2021.
The signed bills were recently passed by the Rivers State House of Assembly.
Wike pointed out that when agencies of the Federal Government were allowed to illegally demand and collect taxes meant for states to collect, they strangulated the states financially and turn them to beggars.
“But we (Rivers State) are standing on the part of history as representatives of the states to have taken the bull by the horn to challenge the illegality of the Federal Government through the Federal Inland Revenue Services (FIRS).
“Of course, we are all aware that the states have already been strangulated. Most states depend on allocation from Federation Account. States have been turned to beggars. Hardly will any day pass that you won’t see one state or the other going to Abuja to beg for one fund or the other.”
The governor said no campaign of calumny or blackmail on the part of FIRS will make what was illegal to become legal, and dismissed FIRS’ propaganda that 30 states would suffer, if some states were allowed to collect VAT.
Wike pointed out that the concerns should be on establishing whose duty it was to collect VAT, and the constitutionality of such position before talking about who was going to suffer or not.
“In this (Rivers) state, we awarded contract to companies, and within the last month, we paid over N30billion to the contractors, and 7.5% will now be deducted from that, and to be given to FIRS.
“Now, look at 7.5% of N30billion of contracts we awarded to companies in Rivers State, you will be talking about almost N3billion only from that source. Now, at the end of the month, Rivers State Government has never received more than N2billion from VAT. So, I have contributed more through the award of contracts, and you are giving me less. What’s the justification for it?”
Speaking further, Wike said there were plans already for FIRS to introduce Road Tax, adding that this was likely to take away more duties from the states, and further emasculating them financially.
“Which are the roads? Are they the roads the state government is paying for or the roads Federal Government has constructed? So, at the end of the day, they have taken over the functions of the state government, and the state is left with nothing.”
The governor remarked that the states have been so emasculated that they could barely survive without monthly revenue received from Federation Accounts Allocation Committee (FAAC).
Wike stressed that the over-bearing attitude of the Federal Government, impinges on attaining financial autonomy for the Legislature and the Judiciary, since the states were not allowed to collect due revenues as specified by the country’s Constitution.
According to Wike, with the Petroleum Industry Act (PIA) passed and signed into law, there shall be unbundling of NNPC, which means that NNPC remittance to the Federation Account will be less, requiring every state to look inwards on how to survive.
Wike, while thanking the state lawmakers for their courage to have given the bill speedy passage, assured that every area that the law allows the state to collect revenue would be maximised for the survival of the state.
Speaking on the Open Rearing and Grazing Prohibition Law No. 5 of 2021, Wike said it was inimical to development and peace, for any state to condone opening grazing of cattle.
Wike said that cattle rearing was agricultural business and the law, which has specified ranching, was so intended in order to stem clashes between herdsmen who go to destroy farmlands, crops, and having problems with farmers that lead to fighting and killing of themselves.
“It is no longer a story. All of us know what our people have suffered in terms of this open grazing. Today, all Nigerians have come to accept the reality that open grazing is no longer fashionable. Even our brothers in the North have agreed that it is no longer fashionable.”
On the Child’s Rights Amendment Law No 2 of 2021, Wike noted that with such law in place now, family courts can become operational in the state.
Wike said the Naming and Renaming of Infrastructure Law No 3 of 2021 would promote the naming of public facilities after prominent Rivers people.
The governor also said that with the Residents’ Registration Agency Law No 6 of 2021, every resident in the state would be registered so that the state government can know their status, what they do, and where they reside for purposes of security planning.
On his part, the Speaker of the Rivers State House of Assembly, Rt. Hon. Ikuinyi-Owaji Ibani, described the collection of VAT by FIRS as the worst form of retrogressive tax in any regime.
He commended the governor and the state government for challenging the constitutionality of FIRS’s collection of VAT in states.
According to him, the signing of the VAT law would ensure that Rivers’ people were not plunged into extreme poverty.
“I am tempered to believe that Nigeria, the world over, is the only country professing federalism but with a unitary constitution, which is the very opposite of what federalism stands for.”
Speaking further, he said the law banning open grazing in Rivers State would serve as both cure to the symptom and the disease of herders’ and farmer bloody conflict.
He said lawmakers would continue to partner the Executive in providing requisite laws that would advance the state for the good of posterity.
The Leader of the Rivers State House of Assembly, Hon Martins Amaewhule, said lawmakers delineated and gave speedy passage to the bills because of their relevance to the socio-economic progress of the state.