A legal luminary and constitutional lawyer, Chief Mike Ozekhome (SAN) has advised parties in dispute over who collects the value Added Tax in Rivers and Lagos States to cease hostilities for now and maintain the status quo until the Court of Appeal finally pronounces on the matter.
Asked who should collect the VAT in the light of Court of Appeal ruling on Friday, the Constitutional lawyer said;”The Court of Appeal, Abuja division, has just ruled that both parties maintained the status quo in an appeal filed by the Federal Inland Revenue Service (FIRS) against the judgement of the Federal High Court , Port Harcourt, validating the Rivers State law that empowered Rivers State Government to collect VAT, as against the FIRS that had hitherto collected VAT.
“Clearly, the status quo ante bellum was before the breakout of the hostilities. The hostilities broke out when the FIRS dragged the Rivers State Government to court, arguing that it cannot collect VAT based on its law. The said law was already duly passed and made operational by Rivers State House of Assembly that haw the constitutional competency under section 4 of the Constitution to do so.
“The Federal High Court , Port Harcourt, Rivers State, had earlier held that it was the Rivers State Government that was competent to collect VAT, not the FIRS. Law was already therefore in operation before the FIRS challenged the validity of a FHC judgement, Port Harcourt, that had given the Rivers State Government the power to collect the VAT.
So, the status quo is that it is the Rivers State Government that has the power to collect VAT, until perhaps, the Court of Appeal rules otherwise and set aside the FHC judgment.
However, the Court of Appeal ruled that all parties on the matter ( including the FIRS, Attorney General of the Federation and the Lagos State Government that sought to be joined should maintain the status quo, so as to preserve the res and prevent the FHC judgment from being negatively affected.
“Consequently, to avoid unnecessary bickerings and needless head-on collision between the Attorney General of the Federation, the Federal Government ( which owns the FIRS) and the Rivers State Government in a matter that is already subjudice, I will advise that both the Rivers State Government and the FIRS should both cease hostilities for now and maintain the status quo until the Court of Appeal finally pronounces on the matter,” he said.