28th November 2024
Business & Economy National News News

Fiscal Federalism: Oyo Joins VAT War

Oyo State government, among other interested States, has asked to be joined in the battle to take over collection of the Value Added Tax (VAT) from the Federal Inland Revenue Service (FIRS).

The state like Lagos State and others asked the Court of Appeal sitting in Port Harcourt, Rivers State, to join it in the suit instituted by the Rivers State government against the attorney-general of the federation in respect of the bid by the state to take over the role from the federal agency.

The suit was filed on a day Governor Seyi Makinde proposed N294.51 billion Appropriation Bill for the 2022 fiscal year to the House of Assembly for scrutiny and approval.

Makinde said his administration plans to raise N79.8 billion as Internally Generated Revenue (IGR).

In the suit, filed by its Attorney-General/Commissioner for Justice, Prof. Oyelowo Oyewo, the state is seeking an order of the appellate court to enable Oyo State to join the suit as an interested party.

The two orders being sought by the government are: an order of the Honourable Court joining the Attorney-General of Oyo State as a respondent on the appeal with suit number FHC/PH/CS/149/2020 and appeal number CA/PH/282/2021, and any other order the court may deem fit.

According to the attorney-general, the government of Oyo State was unaware of the suit between the Attorney-General of Rivers State and the Federal Inland Revenue Service at the Federal High Court until the judgment was delivered.

Other grounds upon which the application was based include that the decision of the appellate court will affect the collection of VAT by the government of Oyo State, being one of the states which the judgment of the lower court recognised as entitled to collect VAT within its territorial jurisdiction.

The state indicates that the applicant (attorney-general) “represents the interest of the Oyo State government, whose interest in the collection of Value Added Tax within Oyo State will be impacted one way or another by any judgment delivered by this Honourable Court in this appeal.

“The Applicant is a necessary party to this suit being a party who will be bound by the judgment of this Honourable Court in this appeal.

“The interests of the applicant and that of the Respondent, in this case, are similar, being States within the Federal Republic of Nigeria.”

In the 12-paragraph affidavit in support of the motion, which was filed by Mr. Olatunji Sunday Thomas, the Director of Civil Litigation in the Oyo State Ministry of Justice, Oyo State, the government said “it is in the interest of justice that the Honourable Court grants the application, adding that the joinder would not prejudice the appellants/respondents.

“The state, being one of the 36 states of Nigeria, will be affected by the decision of the appellate court, adding that joining the state to the suit already instituted by Rivers State will help to avoid multiplicity of suits by the states against the Federal Government.”

In a motion on notice attached to the proceedings already filed before the court, the Oyo govern said it relied on eight grounds and declared that the state is a necessary party to be joined since it has sufficient interest in the outcome of the appeal.

The state further argued that after going through its processes, the appellate court will find that the application is necessary and that it has sufficient interest in the determination of the appeal as one of the states of the Federation.

Citing several legal authorities, the state concluded:  ”We, therefore, urge the honourable court to resolve the sole issue raised in this application in favour of the applicant and hold that the applicant is a proper, desirable and necessary party to be joined in this appeal.

“In conclusion, we humbly urge your Lordships to grant this application in the interest of justice and effective determination of the issues before the court.”

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