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VAT: We can expect litigation all the way to the Supreme Court – Moghalu

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VAT: We can expect litigation all the way to the Supreme Court – Moghalu

Kingsley Moghalu, former CBN Deputy Governor, has said that the Value Added Tax controversy between the Federal Inland Revenue Service (FIRS) and States in Nigeria, strikes a “blow at the lazy Federal Government”, as he expects litigation all the way to the Supreme Court.

Moghalu revealed this in a Twitter statement on Wednesday evening.

What Moghalu said

He said,“The Federal High Court ruling on VAT is the correct one, though we can expect litigation all the way to the Supreme Court. It strikes a strong blow at THE LAZY FEDERAL GOVERNMENT whose head once called our youth “lazy”. Nigeria has long been a fiscally failed state.

Why should states in a supposed federation be producing mainly for the Federal Government. Restructuring has already begun, by fire by force. I pity those who think they can stop the wind.”

What you should know

It can be recalled that on August 9, 2021, a Federal High Court sitting in Port Harcourt in its judgment in a suit marked FHC/PH/CS/149/2020 held that the Rivers State Government had the powers to collect VAT and Personal Income Tax within its territory.

The FIRS, who had earlier appealed the judgement, on Monday, applied for a stay execution on the judgment, however, the presiding judge, Justice Stephem Pam, rejected the application, saying granting it would negate the principle of equity.

On Monday, the Lagos State Government toed the path of Rivers State as a bill to empower it to collect VAT passed the first and second reading in the state House of Assembly.

The Local Government Authorities in Lagos State under the aegis of Conference of 57 Local Governments and Local Council Development Areas (LCDAs) have requested an equal sharing formula with the state in the proposed Value Added Tax (VAT) bill now before the state House of Assembly.

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