Governor Nyesom Wike of Rivers State on Thursday signed into law the bill on Value Added Tax (VAT) collection in the state.
Mr Wike signed the recently passed bill by the Rivers State House of Assembly into law at Government House, Port Harcourt.
He maintained that the judgment of the Federal High Court sitting in Port Harcourt had sufficiently addressed the illegality perpetrated by the Federal Inland Revenue Services (FIRS).
“The Federal High Court sitting in Port Harcourt has 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 also signed into law the Open Rearing and Grazing Prohibition Law No 5 of 2021; The Child’s Rights Amendment Law No 2 of 2021.
Others are the Residents Registration Agency Law No 6 of 2021 and the Naming and Renaming of Infrastructure Law No 3 of 2021.
Mr Wike pointed out that when agencies of the federal government were allowed to illegally demand and collect taxes meant for states to collect, they strangled the states financially and turned them into beggars.
“But we (Rivers State) are standing on the part of history as representatives of the state 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 strangled.
“Most states depend on allocation from federation accounts.
“States have been turned to beggars, hardly will any day pass that you will not see one state or others going to Abuja to beg for one fund,” Mr Wike said.
He said no campaign of calumny or blackmail on the part of FIRS would make what was illegal to become legal.
He dismissed FIRS’ report that 30 states would suffer if some states were allowed to collect VAT.
FIRS chairman Mohammed Nami had asked companies to ignore the court’s ruling as it would subsequently be appealed against.
Mr Wike added that FIRS should be concerned about establishing whose duty it is to collect VAT and the constitutionality of such a position before talking about who was going to suffer or not.
“In this state we awarded contracts to companies and within the last month, we paid over N30 billion to the contractors and 7.5 per cent will now be deducted from that and to be given to FIRS.
“Now, look at 7.5 per cent of N30bn of contracts we awarded to companies in Rivers State, you will be talking about almost N3 billion only from that source.
“Rivers State Government has never received more than N2 billion from VAT at the end of the month.
“So, I have contributed more through the award of contract and you are giving me less, what is the justification for it,” Mr Wike asked.