Tuesday marked a victory day for southern governors in their struggle for control of collection of Value Added Tax in their respective states as both houses of the National Assembly rejected to move it to the exclusive legislative list.
The lawmakers rejected the two provisions during voting on 68 clauses being considered in the ongoing constitutional amendment, on a day full of intrigues.
This was despite last minute lobby to break the ranks of the southern lawmakers in both houses to enable the required two-third that will pass the bill.
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The proposed Bill on VAT reads: “A Bill for an Act to Alter Part I of the Second Schedule to the Constitution of the Federal Republic of Nigeria, 1999 to include Value Added Tax on the Exclusive Legislative List; and for Related Matters”.
At the House of Representatives, 209 members voted against any movement, thus allowing it to stay on the current legislative list, a shared constitutional provision between the federal and state governments.
The senate also rejected the bill as 44 senators kicked against it while 41 voted in support.
The southern lawmakers had before the call for the day’s legislative action rallied around their respective governors in the states.
Apart from Cross River and Ebonyi States whose governors did not make their commitment known in the southern governors’ forum, the other 15 states made case for states to collect VAT.
This prompted Rivers State to head to court and was later joined by Lagos State. The states secured victory up to the Appeal Court, forcing the federal government to make an appeal at the Supreme Court. The court is yet to make final decision.
The Federal Inland Revenue Service had on behalf of the central government approached the national assembly to include VAT collection in the exclusive legislative list.
The FIRS had proposed the insertion of VAT immediately after Stamp Duties under item 58 part II of the 2nd schedule of the 1999 Constitution.
The mood at the Assembly after the voting exercise was contrasting as the Southern senators celebrated. But some Northern senators did not.