Lagos State Governor Babajide Sanwo-Olu Friday signed into law, the State Value Added Tax (VAT) bill as passed by the House of Assembly.
Gbenga Omotoso, the State Commissioner for Information and Strategy said the Governor signed the “bill for a law to impose and charge VAT on certain goods and services” at about 11.45 am today, after returning from an official trip to Abuja.
The state will however apply the brake on the implementation of the law following the ruling on Friday of the Court of Appeal, Abuja Division, ordering the Rivers Government, the Federal Inland Revenue Service (FIRS) and the Attorney-General of the Federation to maintain the status quo, pending the hearing and determination of applications before it in respect of the Valued Added Tax (VAT).
The matter has been adjourned to September. 16.
Rivers state like Lagos state had signed its tax law which empowers it to collect every tax including the VAT which has turned controversial.
The Federal High Court, Port Harcourt, on 9th August declared that it was the Rivers Government, and not FIRS that should collect VAT and Personal Income Tax in that state.
On Friday however, the three-man panel of Appeal Court justices led by Justice Hassan Tsammani ordered all parties to maintain the status quo and refrain from taking any action that would give effect to the judgment of the Federal High Court, Port Harcourt.
Justice Tsammani held that since all parties in the matter had submitted themselves before the court, it was proper and the law for the court to preserve the res (subject matter) from being rendered nugatory.
Consequently, the court held that parties should refrain from giving effect to the judgment of the trial court in Port Harcourt pending the hearing and determination of the application of the FIRS to stay execution of the trial court’s judgment.
Parties are also to maintain the status quo pending the hearing of an application by the Attorney-General of Lagos State to be joined as a party in the matter.
Counsel to the appellant/applicant, Mahmud Magaji made an oral application for an order that status quo be maintained pending the hearing and determination of the motion for injunction and stay.
However, Emmanuel Ukala counsel to Rivers government, and Oyosore Onigbanjo counsel to Lagos State Government, both opposed the application for status quo.
Tijani Ghazali who represented the attorney-general for his part, supported the application for the status quo to be maintained.
The applicants have been given two days to file their written addresses in respect to the pending applications just as the respondents have also been given two days to file, and the applicant has one day to reply on points of law.
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