Close Menu
Podium ReportersPodium Reporters
  • Home
  • News
  • Economy
    • Global
    • Nigerian
  • Education
  • Politics
    • Asia
    • Africa
    • Europe
    • Finance
    • Nigeria
    • US & Canada
    • World
  • Science
    • Health
  • Lifestyle
    • Entertainment
      • Comedy
      • Ent & Arts
      • Film & Drama
      • Music
      • videos
    • Homes
    • Luxury
    • Media & Culture
  • Sports
  • Others
    • About us
    • Get In Touch
Facebook X (Twitter) Instagram
Trending
  • Peter Obi’s former running mate, Datti goes to the altar for Tinubu’s reelection, says God has annointed Tinubu’s second term
  • Kí ẹran má jalé Acitvism, Yele Sowore, the New Jersey Revolutionary Who Sells Revolution While His Family Lives in America
  • US Air Force Delivers Military Equipment to Nigerian Air Force
  • Nigeria Has Crossed the Rubicon, On Path to Sustainable Growth – Shettima
  • First Lady Flags Off Empowerment Programme for 2,500 Women in South-East
  • PBAT Redeems $100,000 Cash Rewards for D’Tigress Players, Completes Presidential Sports Promises
  • 2023 presidency: Obi repeats unproven claim, says INEC chair worked against him
  • We’re moneybags, not funders, Nigerians should pity our party and donate for presidential campaigns, Dickson, Peter Obi pleads
Facebook X (Twitter) Instagram
Saturday, September 12
Podium ReportersPodium Reporters
Demo
  • Home
  • News
  • Economy
    • Global
    • Nigerian
  • Education
  • Politics
    1. Asia
    2. Africa
    3. Europe
    4. Finance
    5. Nigeria
    6. US & Canada
    7. World
    8. View All

    Korea-Africa Summit: Has a new chapter opened in South Korea-Africa Relations?

    9 June 2024

    Aregbesola Champions Easier Path to Naturalisation, Announces Brown Card For Permanent Residency 

    28 May 2023

    PBAT: Africa Deserves Fair Credit Ratings

    3 September 2026

    Shettima Takes South Africa’s Xenophobic Attacks to AU, Demands Urgent Continental Action

    1 September 2026

    Osun Guber: I Owe My Reelection Victory to Tinubu, Adeleke Declares in Appreciation Message

    16 August 2026

    BREAKING: Adeleke Defeats APC’s Oyebamiji to Win Osun Governorship Election

    16 August 2026

    UK-based Obidient, Oluomo of Derby accused of turning “Nigerians in UK” group into personal company; rakes in over £100k in secret deals

    24 January 2025

    Ukraine hits Russian city and oil refinery on day two of presidential vote

    16 March 2024

    SpaceX Ventures into Spy Satellite Network in Classified Deal with U.S. Intelligence

    16 March 2024

    Breaking: Queen Elizabeth II is dead

    8 September 2022

    First Lady Flags Off Empowerment Programme for 2,500 Women in South-East

    10 September 2026

    PBAT’s Economic Reset Gains Momentum as Oyedele Leads Nigeria’s Fiscal Transformation

    30 August 2026

    President Tinubu Approves Landmark Deep Offshore Investment Framework to Unlock Up to US$50 Billion in New Investment

    14 August 2026

    Benue is building again, and Abuja is building with it, by Babajide Fadoju

    9 August 2026

    US Air Force Delivers Military Equipment to Nigerian Air Force

    11 September 2026

    Nigeria Has Crossed the Rubicon, On Path to Sustainable Growth – Shettima

    11 September 2026

    First Lady Flags Off Empowerment Programme for 2,500 Women in South-East

    10 September 2026

    FG Begins Process to Roll Out 112 National Emergency Number Nationwide

    9 September 2026

    US Air Force Delivers Military Equipment to Nigerian Air Force

    11 September 2026

    BREAKING NEWS: Trump returns as US President with a projected 312 electoral votes; Kamala cancels victory party

    6 November 2024

    Toronto Police arrests Amaka Sunnberger over threats to poison Yoruba and Benin people

    2 September 2024

    SpaceX Ventures into Spy Satellite Network in Classified Deal with U.S. Intelligence

    16 March 2024

    US Air Force Delivers Military Equipment to Nigerian Air Force

    11 September 2026

    Atiku, Obi, Others’ Opposition Summit Shifted to August 31

    15 August 2026

    Tinubu Says Nigeria’s Reforms Driving Global Recognition, Promises More Economic Gains

    26 July 2026

    PBAT Pushes for Fair Global Finance System at Africa Forward Summit in Kenya

    13 May 2026

    US Air Force Delivers Military Equipment to Nigerian Air Force

    11 September 2026

    Nigeria Has Crossed the Rubicon, On Path to Sustainable Growth – Shettima

    11 September 2026

    First Lady Flags Off Empowerment Programme for 2,500 Women in South-East

    10 September 2026

    PBAT Redeems $100,000 Cash Rewards for D’Tigress Players, Completes Presidential Sports Promises

    10 September 2026
  • Science
    1. Health
    2. View All

    FEC Approves N1.02tn Infrastructure, Health Projects as Tinubu Orders Fresh Funding for NELFUND

    20 August 2026

    RHA Tour: Nasarawa Gov’t Steps Up Healthcare Transformation with N6bn Specialist Hospital Project

    10 August 2026

    Pate Fires Warning Shot: Nigeria’s 230M Poulation Either Feeds the Nation or Devours It

    10 August 2026

    Nasarawa Governor Receives Presidential Renewed Hope Ambassadors Media Team, Commends Tinubu Administration’s Reforms

    9 August 2026

    Tinubu’s Education Reset: EFCC Cash, N242bn Dividends and N155bn Library Fund Put to Work

    20 August 2026

    FEC Approves N1.02tn Infrastructure, Health Projects as Tinubu Orders Fresh Funding for NELFUND

    20 August 2026

    RHA Tour: Nasarawa Gov’t Steps Up Healthcare Transformation with N6bn Specialist Hospital Project

    10 August 2026

    Pate Fires Warning Shot: Nigeria’s 230M Poulation Either Feeds the Nation or Devours It

    10 August 2026
  • Lifestyle
    1. Entertainment
    2. Comedy
    3. Ent & Arts
    4. Film & Drama
    5. Music
    6. videos
    7. Homes
    8. Luxury
    9. Media & Culture
    10. View All

    PBAT Redeems $100,000 Cash Rewards for D’Tigress Players, Completes Presidential Sports Promises

    10 September 2026

    PBAT Orders Sweeping Reform of Nigerian Football Amid Persistent Qualification Failures

    27 August 2026

    Osun Election: Davido Blows Hot Tears, Begs Trump Like a Lost Toddler, over Gov Adeleke’s imminent defeat

    11 August 2026

    Gospel Loss: Adegbodu Twin in fresh storm as tributes pour in

    1 March 2026

    Soyinka @ 90: President Tinubu renames National Theatre, Lagos to Wole Soyinka Center of Culture and Creative Arts

    12 July 2024

    God ordained Tinubu to be President of Nigeria – Oba of Benin

    27 November 2023

    Photos: Banky W, Adesua finally reveal son

    17 September 2022

    Nigerian Star Tems to Lead First-Ever FIFA Club World Cup Final Halftime Performance

    10 June 2025

    Renewed Hope Concert puts Nigeria in celebratory mood as excited youths look forward to Tinubu’s swearing-in

    26 May 2023

    VIDEO: President Tinubu Attends Matawalle Family Wedding Ceremony In Abuja

    6 February 2026

    VIDEO: NDLEA Warns Travellers Against Carrying Unfamiliar Luggage Amid Rising Drug Smuggling Cases

    29 June 2025

    VOXPOP Reviews: Public and Students of National Open University on Newly Signed Student Loan Scheme by President Bola Ahmed Tinubu

    3 April 2024

    BREAKING: President Bola Tinubu has officially approved and signed the amendment bill for national student loans into law.

    3 April 2024

    “OHITTY”—THE ORIGIN AND THE POWER BEHIND THE UNDYING VISION OF THE MAN WHO BEARS THE NAME

    5 September 2026

    Atiku vs. Tinubu: Court Slams Gag Order as ‘Certificate Scandal’ Suit Turns into Soap Opera

    1 September 2026

    IMF Anoints Nigeria: Economy Outruns Global Giants, Enters World’s Top 10

    1 September 2026

    Osun Election: Davido Blows Hot Tears, Begs Trump Like a Lost Toddler, over Gov Adeleke’s imminent defeat

    11 August 2026

    Did you know? – Perfumery edition

    10 August 2022

    Do You Know Who Wore the First Lipstick?

    10 August 2022

    FG Begins Process to Roll Out 112 National Emergency Number Nationwide

    9 September 2026

    Tinubu FOIA Case Is Civil, Not Criminal — Presidency Clarifies

    3 September 2026

    PBAT Renews Tenure of NTA, NAN CEOs for Another Three Years

    24 August 2026

    FG Unveils Livestock Transformation Agenda to Boost Productivity, Food Security and Peace

    12 August 2026

    PBAT Redeems $100,000 Cash Rewards for D’Tigress Players, Completes Presidential Sports Promises

    10 September 2026

    FG Begins Process to Roll Out 112 National Emergency Number Nationwide

    9 September 2026

    “OHITTY”—THE ORIGIN AND THE POWER BEHIND THE UNDYING VISION OF THE MAN WHO BEARS THE NAME

    5 September 2026

    Tinubu FOIA Case Is Civil, Not Criminal — Presidency Clarifies

    3 September 2026
  • Sports
  • Others
    • About us
    • Get In Touch
Podium ReportersPodium Reporters
Home » News » Fiscally Speaking: the VAT Question and a Few Answers
Business Updated:5 August 2022

Fiscally Speaking: the VAT Question and a Few Answers

By Adekunle15 September 2021No Comments5 Views6 Mins Read
Facebook Twitter LinkedIn WhatsApp Reddit Email
Share
Facebook Twitter LinkedIn Email Reddit WhatsApp

The buzz of VAT and its administration has captured the headlines of most blogs and newspapers in Nigeria. At the centre of the conversation is the Rivers State Governor, Nyesom Wike, pushing forward a VAT law that seeks to collect Value Added Tax from Rivers businesses as against paying to the Federal Government. Backing him is the judgment of a Federal High Court that declared the collection of VAT by the Federal Government illegal, and empowered Rivers State to do so.

Another state is joining in: Lagos. And if newspaper headlines are anything to go by, more States who see a pie to be eaten from VAT gains would join too.

But this judgment is seen as odd to many: after over two decades of VAT administration saddled in the hands of the Federal Government, it suddenly has become illegal? On what basis has the Federal Government then carried out this now illegal act?

Can the VAT Act, a Federal Legislation passed by the National Assembly now become impotent and subservient to State law on the same matter? Does this Act become inapplicable because VAT is not expressly mentioned in the constitution? That should not be so. The powers of the National Assembly to make laws on tax matters are not limited to just those in the Exclusive and Residual lists.

Another question that has been asked by legal commentators is this: How come this judgment now, when some years ago, the Supreme Court gave its blessing to the VAT Act as being above and superior to similar legislation that Lagos State was proposing then. It quashed that Lagos law then.

Similarly, a Federal High Court in Kogi State said that the FIRS was the sole collector of VAT taxes and not the State. Two courts of coordinate jurisdiction have given different pronouncements on the same matter. Sadly, taxpayers would be the victims of the confusion. The hope they have now is the order of the Court of Appeal stating that the parties to the case must not give any effect to the weird judgment of the Federal High Court that sat in Port Harcourt, Rivers State and that the status quo ante bellum be maintained.

Questions were rife when the judgment first surfaced. For one, businessmen in Rivers were already confused as to whether they were to pay their VAT to Rivers state or the Federal Government, even when their headquarters are situated in other states. When they shared these concerns with the Governor during a stakeholder conference he held with them, he had no answers for them.

Then there is also the question of the technical input and output mechanism that defines why VAT as a goods and service tax across the globe has remained a matter left for the national and not the sub-national units.

The outcome of the FIRS application for stay of proceedings at the Court of Appeal if granted would only hold effect till the final determination of the matter. That final determination is eagerly awaited, to ease the needless tension this political and economic confusion has brought to taxpayers.

If it ever happens, the domino effect of states collecting VAT as against the Federal Government, which equitably shares it amongst the three tiers of government, would be felt strongly. Some states would be at the bad end of the stick and would end up running back to the Federal Government. The financial status of any state that thinks collecting VAT by itself would make it richer may not change as much as it thinks.

For instance, the argument that some have made saying that Lagos generates the most VAT is inchoate. What those who make this postulation do not tell you is that Lagos fetches the most VAT because it enjoys the “Headquarters Effect,” such that a business that transacts all across the country pays no VAT in those places it transacts in, but pays it where its Headquarters is situated: Lagos. If these businesses were to pay VAT across the country, in the places they make their money, the myth of the Lagos jumbo VAT would be crushed.

Nigeria is primarily a federation: it is a union, and unions join together, bringing the strengths of each unit to bolster a common front. A powerful country with strong sub-national units is the goal. Not extremities of competing states against each other. Yes, while many states are not as economically strong as others, the strength of a Federation is not limited to just each unit working to attain maximum economic capacity but extends to providing strength to weak states equitably so that they can grow and meet up.

So when farm produce harvested in the farms of Jigawa or Benue, are processed in the industries of Ogun and Oyo State, with VAT being charged to the final product from Ogun and Oyo, we see states bringing their strengths together for the good of the nation, while not belaboring taxpayers at each point of economic activity. If States, where food crops were to be harvested, decide to tax them at source, coupled with VAT paid on the final items, the cost of food items would skyrocket.

Ultimately, were the VAT collection to be positioned in the states and the Federal Government too, the winner would be the Federal Government, which already rakes in a big chunk of the collected sum from VAT paid in the Federal Capital Territory and that collected from imported goods. That does no good to the Federation. States lose at the end.

The Federal Government, through the FIRS already has a strong and capable collection framework. It is better placed than States to do this. Its contested 4% collection charge is little compared to the work that its machinery uses to ensure an effective, smooth, and accurate collection of these funds—such that none of it ends up in the hands of unruly thugs or corrupt officers.

Nigeria, as a whole, has more to benefit from VAT administration operated from the Centre. Citizens do not want annoying double-taxation on goods that would be suffered when states begin to pass individual and irregular VAT laws for themselves. Already, the proposed VAT percentage by Rivers State differs from that Lagos is proposing. Moreover, the current structure works for the equitable distribution of resources: states bringing more to the table still get so much; economically weaker states get just enough too. For instance, Rivers State which brought in about 43 Billion Naira into the VAT pool in 2020, took back 40 Billion Naira as its allocation.

Political leaders, as they enter into the debate of what works best should think win-win for the country. A dog-eat-dog approach on the VAT question would not augur well for the citizens in the long run. When a federation is at war with itself, nobody wins.

Mohammad T. Abiodun, a historian writes from Abuja.

Business Economic economy TAX VAT
Share. Facebook Twitter Pinterest LinkedIn Telegram Email WhatsApp

Related Posts

07 Views

US Air Force Delivers Military Equipment to Nigerian Air Force

11 September 20261 Min Read
03 Views

Nigeria Has Crossed the Rubicon, On Path to Sustainable Growth – Shettima

11 September 20263 Mins Read
04 Views

First Lady Flags Off Empowerment Programme for 2,500 Women in South-East

10 September 20263 Mins Read
Add A Comment
Leave A Reply Cancel Reply

© 2026 The Podium Reporters. Designed by Marvelworx Limited.
  • Home
  • Economy
  • Education
  • Lifestyle
  • Politics
  • Science
  • Sports

Type above and press Enter to search. Press Esc to cancel.