The Speaker of the Lagos House of Assembly, Mudashiru Obasa, has remarked on the imbalance between the state’s Value Added Tax (VAT) generation and its compensation from the Federal Government, describing it as a “paltry sum”.
He said this through his representative, Wasiu Eshilokun, at a public hearing at the State House of Assembly, Alausa, Ikeja, on ‘A Bill for the law to impose and charge value Added Tax on certain goods and services provided for the administration of the tax and other Related Matters.’
The comments follow the judgement delivered by Justice Stephen Dalyop of a Federal High Court in Rivers State, where the Federal Inland Revenue Service (FIRS) and the Attorney General of the Federation were restrained from demanding the payment of VAT to the FIRS from the Rivers State Government.
Eshilokun said that Lagos State was unfairly treated by the Federal Government despite its about 55 percent contribution to the “VAT collectables” in the country.
He said, “Hitherto, the responsibility of collecting VAT is assumed by the Federal Government, through the Federal Inland Revenue Services, FIRS. This, I reckon is against the messages and spirits of the true federalism that our fathers fought for and that we are currently agitating.
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“Lagos State feels financially strangulated and unfairly treated by the Federal Government in her administration and appropriation of receipts of VAT.
“Lagos state, for instance, generates the excess of 500 billion in VAT form. If we go by generation trend, in tandem with the N2.4 trillion forecasted by the FIRS, Lagos state will be contributing about 55 per cent of the total VAT collectables in the entire country.
“But what do we get in return, some paltry sum. This injustice and inequity are part of the premises that some of the extant agitations are founded.
“Thankfully, the judiciary through the Federal High Court of Portharcout Division came to the rescue of the nation and assuaged the fears of teeming Nigerians in her judgement.
“It is in the light of this judgement the Lagos State’s seeks by proposing to practicalize this her bill rights for a law that will enable the state to collect VAT that will ensure the state could thereby create a complete true developmental federalism goals.”
