FIRS cannot collect VAT, income tax, court rules

Admin l Tuesday, August 10, 2021

PORT HARCOURT, Rivers, Nigeria- A Federal High Court sitting in Port Harcourt, Rivers State has ruled  that the Federal Government can neither collect Value Added Tax, VAT, nor Personal Income Tax but that only the state government can collect these taxes.

Justice Stephen Dalyop Pam who made the clarification also issued an order of perpetual injunction restraining the Federal Inland Revenue Service and the Attorney-General of the Federation, both first and second defendants in the suit, from collecting, demanding, threatening and intimidating residents of Rivers State to pay VAT and PIT.

Justice Pam who was delivering judgment in suit No. FHC/PH/CS/149/2020, filed by Commissioner for Justice Rivers State against the FIRS (first defendant) and the Attorney-General of the Federation (second defendant), said only the state can collect VAT and PIT.

The Rivers State Government had requested the court to determine whether it is the duty of the FIRS to collect Value Added Tax and Personal Income Tax or Rivers State Government.

FIRS has been under pressure to collect taxes to shore up revenue for the federal government.