Governor of Ekiti State, Kayode Fayemi, has stated that the Nigerian Governors’ Forum (NGF) is awaiting the decision of the supreme court over value-added tax (VAT) collection.
Fayemi, who is also the Chairman of the NGF, stated that Nigeria’s tax system is both problematic and confusing which requires attention.
The Southern Governors’ Forum recently supported states collection of VAT rather than the Federal Inland Revenue Service (FIRS) on behalf of the federation.
Following the jugdment by a Federal High court in Rivers State, Rivers and Lagos states passed laws for VAT collection, however, the court of appeal directed that states should maintain statuo quo pending the determination of an appeal filed by the FIRS.
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Rivers State had also requested that the Supreme Court set aside an order of the court of appeal.
Fayemi, who was a guest on Arise Television on Sunday, said governors are expecting the judgment of the case instituted by some state governors.
He noted that the governors’ forum is presently viweing the issues and consulting on the implications of the collection on state governments.
“For us, at NGF, this is an issue we are looking at both legally and policy-wise. We are asking our experts to help us look at the implications for states,” Fayemi said.
“Our take is that the supreme court should accelerate decision on this so that we have clarity over who should be in charge of VAT – whether FIRS or states.
“We will wait for the supreme court to have a decision on this.
“The important thing is that our tax system is problematic, confusing and contradictory, and we need to do a lot more to begin to clarify things. So that we can have more efficient ways of collecting taxes.”
When asked about President Muhammadu Buhari’s calls for the cancellation of debt at the United Nations general assembly, Fayemi said the federal government’s borrowing is for reasons and are specific loans.
“Nigeria is borrowing for reasons that are specific. The bulk of what we are borrowing is specific. If you look at what we are borrowing. You will see that these are specific borrowings and most attractive,” he said.
Fayemi said the borrowings are in line with World Bank and IMF standards.
“On the other hand, you have the Chinese infrastructure lending,” he added.
“We can now quiz whether we should be using 97 percent of servicing on debt. That’s a debate we can have.
“The issue is what are you borrowing for. Are you borrowing for consumption or infrastructure development?
“Buhari needs to be commended on that.
“The question is we have revenue challenges…borrowing is a win-win situation for our country and economy.
“I don’t think there is anything wrong if President is calling for a review of debt structuring.”
