'Sheath your swords!' Umahi urges governors to drop fight over VAT

Ebonyi State Governor, David Umahi, has appealed to state governors to sheathe their swords as the dispute over who should collect Value Added Tax (VAT) between the state governments and the Federal Inland Revenue Service (FIRS) persists.

He argues that if the FIRS is deprived of its authority, just a few states would benefit significantly, while others will suffer.

“I’m asking with my colleagues to put down their swords and let us get through this difficult period before we start debating who is right and who is wrong.

“We have to be our brother’s keeper; we have to figure out how to build the economies of the poorest states, otherwise we will generate a lot of insecurity among those superpowers; this is critical.”

Since the Rivers State administration decided to challenge the constitutionality of FIRS collecting VAT in other states, a slew of lawsuits and decisions have appeared.

‘Ebonyi Should Be Pitied’

The dispute started on August 9 when a Federal High Court in Port Harcourt granted the state government the right to collect VAT – an order that affected other states.

Although the case is before the Supreme Court, the latest is the reservation of the ruling of the Court of Appeal in Abuja, on the application for a joinder filed by the Lagos State government.

But Governor Umahi proposed that before states should be allowed to collect VAT, the ‘weakest states’ must be provided with enough resources to give them a comparative advantage.

According to him, the Federal Government should be the major contributor to VAT while state and local governments should have 85 per cent and the remaining 15 per cent taken by the Federal Government.

“Now, the Federal Government and the super states will be the most beneficiaries, and a number of states will collapse and by the reason of rampant law,” the governor decried. “I am also encouraging the Federal Government to look the way of Ebonyi State, we are highly disadvantaged.

“You say we should grow the economy, with what? We don’t have money to grow the economy. We have agriculture, we have solid minerals, and our solid minerals are being stolen away. Ebonyi State should be pitied, we’re in a very difficult situation. We have a lot of our youths unemployed.”