Legal Nigeria

Employers association asks all companies to ignore Lagos, Rivers, remit VAT to FIRS

The association of private sector employers said VAT collected for August 2021 should be paid to FIRS.

HILLARY ESSIEN 

NECA DG, Mr Timothy Olawale
NECA DG, Timothy Olawale

The Nigeria Employers Consultative Association (NECA), a trade union of employers in the private sector, has directed all its members to make their value added tax remittances for the month of August to the FIRS.

“Consequently, all VAT collected for the month of August 2021 should be remitted to the FIRS based on the Order of the Court of Appeal,” said the document signed by the body’s Director General, Timothy Olawale. 

This instruction comes amidst the consumption tax tussle between states and the federal government. The organised private sectorhad raised concerns over the tax controversy as the deadline for August remittances is set for September 21. 

The FIRS had been collecting consumer tax in all states of the federation before being challenged in Rivers State by the Port Harcourt Division of the Federal High Court. Justice Stephen Pam’s landmark judgement held that the federal government lacked constitutional power to collect VAT.

The revenue collection body then approached the appeal court to challenge the judgement, whose rulingordered all parties in the suit to maintain status quo on the moves by individual states to start collecting the tax.

Rivers and Lagos went ahead to pass the state law in August and Septemberrespectively.  Rivers state has instituted action at the Supreme Court challenging the Court of Appeal’s order.

Rivers demands include a fresh hearing of the revenue collection body’s appeal and a request for the apex court to set aside the ruling made by the appellate court.

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