States Have No Power To Enact Laws On VAT Collection – Malami

Attorney-General of the Federation (AGF), Abubakar Malami, says state governments have no power to legislate on Value Added Tax collection.

Malami added that only the National Assembly has the power to enact VAT law, stating that this will be challenged in court.

While addressing journalists after the federal executive council (FEC) meeting on Wednesday, the AGF said federal government is hedaing to the Supreme Court for the legal battle.

He said, “One thing that is fundamental that you need to know as being the issue equally being considered for determination by the court is the federal government is challenging the powers of the state governments to legislate on the issues associated with collection of VAT.

“And the position of the federal government as canvassed, which is being looked into by the judicial system, is to the effect that by our laws, the powers to legislate on collection of VAT is statutorily vested in the national assembly. And with that in mind, it is not within the scope and powers of the state government to legislate on the issue of collection.

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“So, what I’m saying in essence, is just to give an insight as to the multiple contentions between the parties as being determined, as being canvassed, presented for the determination of the court.

He added, “…as you rightly know, there were certain judgments obtained by some state governors at their jurisdiction and localities before their respective state high courts, and arising from those judgments and the laws that were passed by those state governments, the federal government filed an appeal against the judgement challenging the laws that were put in place, which I feel has been determined by the court of appeal,” he said.

“The court of appeal has granted an order of stay of execution, directing these state governments to maintain status quo pending the determination of the main appeal and these matters are being considered for determination.

“And some other governors have filed in an application for joinder, seeking to be joined in the matter as interested parties. But again, there is pending, equally, an application and preliminary objection for that matter, challenging the competence of the action and indeed the judgement that was obtained.

“But the federal government is still looking at other possibilities, all options open, in terms of challenging the action, the action of the state governments.”