Rivers Governor, Nyesom Wike, has signed into law bills on Value Added Tax (VAT) collection and Open Grazing Prohibition in the state.
Governor Wike maintained that the judgment of the Federal High Court in Port Harcourt, had sufficiently addressed the illegality perpetrated by the Federal Inland Revenue Services (FIRS) on behalf of the Federal Government in the collection of VAT in states.
He spoke at the Government House, Port Harcourt, yesterday, shortly after signing into law the VAT Law No. 4 of 2021; The Open Rearing and Grazing Prohibition Law No 5 of 2021; The Child’s Rights Amendment Law No 2 of 2021; The Residents Registration Agency Law No 6 of 2021 and the Naming and Renaming of Infrastructure Law No3 of 2021 recently passed by the state House of Assembly.
Governor Wike pointed out that when agencies of the Federal Government are allowed to illegally demand and collect taxes meant for states to collect, they strangulate the states financially and turn them to beggars.
He said: “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 FIRS.
“Of course, we are all aware the states have already been strangulated. Most states depend on allocation from federation account. States have been turned to beggars. Hardly will any day pass that you won’t see one state or the other going to Abuja to beg for one fund or the other.”
The governor said no campaign of calumny or blackmail on the part of FIRS would make what is illegal legal.
He dismissed FIRS’ propaganda that 30 states would suffer if some states are allowed to collect VAT.
Governor Wike pointed out that the concerns should be on establishing whose duty is it to collect VAT and the constitutionality of such position before talking about who is going to suffer or not.
“In this (Rivers) state, we awarded contract to companies and within the last month we paid over N30 billion to the contractors and 7.5 percent will not be deducted from that and to be given to FIRS.
“Now, look at 7.5 percent of N30 billion of contracts we awarded to companies in Rivers State, you will be talking about almost N3 billion only from that source. Now, at the end of the month, Rivers State government has never received more than N2 billion from VAT. So, I have contributed more through the award of contract and you are giving me less. What’s the justification for it?”
Governor Wike said there were plans already for FIRS to introduce Road Tax and this would likely take away more duties from the states, and further emasculate them financially.
“Which are the roads? Are they referring to the roads the state government is paying for or the roads the Federal Government has constructed? So, at the end of the day, they have taken over the functions of the state government and the state is left with nothing.”
The governor remarked that the states had been so emasculated that they could barely survive without monthly revenue received from Federation Accounts Allocation Committee (FAAC).
Governor Wike stressed that the overbearing attitude of the Federal Government impinges on attaining financial autonomy for the legislature and the judiciary, since the states are not allowed to collect due revenues as specified by the country’s constitution.
According to Governor Wike, with the Petroleum Industry Act (PIA) passed and signed into law, there should be unbundling of Nigerian National Petroleum Company (NNPC), which means NNPC remittance to the federation account would be less, requiring every state to look inwards on how to survive.
Governor Wike, while thanking the state lawmakers for their courage to have given the bill speedy passage,said every area that the law allows the state to collect revenue would be maximised for the survival of the state.
On the Open Rearing and Grazing Prohibition law, No.5 of 2021, Wike said it was inimical to development and peace for any state to condone opening grazing of cattle.
He said cattle rearing is agricultural business and the law, which has specified ranching, is so intended to stem clash between herdsmen, who go to destroy farmland, crops, and having problems with farmers that lead to fighting and killing of themselves.
On the Child’s Rights Amendment Law No 2 of 2021, Governor Wike noted that with such law in place now, family courts can become operational in the state.
He said the Naming and Renaming of Infrastructure Law No3 of 2021 would promote the naming of public facilities after prominent Rivers people.
The governor also said with the Residents Registration Agency Law No 6 of 2021, every resident would be registered so that the state government can know their status, what they do and where they reside for purposes of security planning.