Their organization has been reaping where they did not sow. The have to pay back.

baby124:

Businesses charge the consumer the tax and remit it to the state government. Consumer does nothing. It’s tax added unto finished goods and services. If you look at your receipt, the total amount you pay the business is cost of goods + VAT.

But you're being charged VAT when you make purchases.

kokoA:
But you're being charged VAT when you make purchases.

Yes. That is the tax. But FIRS had been collecting it instead of the state. Now the states are demanding that they should be the ones collecting it, which is very true.

supportnija:

How would the state collect their own VAT? If I buy N100 MTN recharge card in sokoto, my VAT is N1 which at the end of the month FIRS go to the MTN to collect this N1 in the head office in lagos. If VAT is going to start , it means , it should be calculate according to state consumption not according to present of the head office, you will see that, Lagos and rivers may ended up getting nothing. My problem with some of you is that your sentiment have overide you

That's an open chance for more network providers to come in for investment.

In the US banks has no branches, just one center.

supportnija:

How would the state collect their own VAT? If I buy N100 MTN recharge card in sokoto, my VAT is N1 which at the end of the month FIRS go to the MTN to collect this N1 in the head office in lagos. If VAT is going to start , it means , it should be calculate according to state consumption not according to present of the head office, you will see that, Lagos and rivers may ended up getting nothing. My problem with some of you is that your sentiment have overide you judgement

Not really.

Rivers and Lagos will get substantial taxes due to their population but it will never reflect in the lives of the residents.

The funds will still be mismanaged and looted There will be no impact , eventually

You all talking about Owanbe party tax have not thought of how that will lead to double taxation. Each and every item used in most Owanbe parties are already taxed, why should there be a separate Tax again. 50% of every party cost most times is on feeding and entertainment. Food items are exempted from VAT, but then other ingredients would have already include VAT in their prices, a state like Lagos will still charge Consumption Tax at 5% which would have been part of Hall rented for such parties. If we calm down and do the analysis properly, you will know that more taxes are generated from Owanbe parties than religious organizations in Nigeria, even though the latter make more money

Canvass:


I absolutely subscribe to your brilliant points, especially that Owambe own. All those 'Ijebu' men that places premium on grand parties over more important things and all those claiming 'big-for-nothing' must get sense by force.

Only that the same politicians putting the laws in place would be the first to circumvent those laws. Such a sad country.

flowbjones:


50% Ogini

Any Party like Obi Cubana’s own where money was flying all over the place and being thrown away can afford the 50% Owambe Party Tax.


At least they will first do money Contributions for Owambe Tax before they start throwing away the money and trampling it on the floor

supportnija:

You a lier, Lagos would not , Lagos would be nothing, today , TOTAL pay VAT , OANDO pay VAT, Mobil PAY VAT all in lagos etc all these head office would force to pay their VAT according to each state according to consumption, today over 44millions liters used petrol and Diesel in Nigeria today are only paid in Lagos, Some of you think , it is so simple that like that, I can recharge my phone and pay my VAT in my state. NLNG head office in Porthacourt now will pay VAT to Rivers, You see how funny are some of you!

What you are saying is illogical

The change Buhari and APC promised but couldn't fulfilled is being delivered by Governor Nyesome Wine of PDP

Let them slash their pay. Most of them are deadwood anyway who only got the job through connections not merit.

The problem is do these States have the capacity to collect these taxes. They are yet to maximally collect taxes like property tax, payee, consumption tax.

AntiBMC:


Oga, if you are in Sokoto, ur VAT will be charged there. There are millions of MTN users in various States, same with other telecom networks. So if everyone pays his/her VAT in state he/she resides, I don't see how Lagos and Rivers with their huge population, will end up getting nothing. So in essence, it's either u didn't read what you wrote up there, or you are the sentimental one.

The worrisome thing about this your scenairo is that

1.It could lead to multiple taxation.Under the new arrangement, Lagos is collecting VAT on the profits MTN earns in Nigeria, since MTN's HQ is located in Lagos, while Sokoto is again collecting VAT from MTN operations in its domain....meaning MTN can end up, theoretically, paying tax twice (unless MTN pays VAT on calls made in Lagos...which means Lag gets a reduction in the estimated amount they were expecting to collect in VAT. The same thing happens for other network providers.)

2.If Sokoto is not earning enough VAT from MTN consumption in its domain, it could increase the VAT a la true federalism since he who collects taxes also controls how much he pays...which will be passed on by MTN to the consumer in the form of 'high prices'

And as happens in Sokoto, it happens in other states too. A time could come where states increase VAT on MTN calls made in their state (and then there is the fun bit about calls made between states and to overseas).just to get extra money....either way MTN will pass the cost to us in the form of high prices.

We had this problem with right of way for telecom cables...where some states wanted to charge the earth vs some other states.

DubaiLandLord1:
Please shut up your mouth. You talk as if nobody is living in Lagos.

If every states start collecting VATs themselves, no state will come close to Lagos, no matter what.

No state in the North East or North West can generate more VATs than Lagos.

Even both mentioned regions combined may struggle to compete with only Lagos

Christistruth00:


Once the Tax Officers see more than 4 Cows then Tax Collectors will Issue a Tax notice which can be Appealed if the Owambe Party holders don’t agree

Also if you are using a Venue that Cost more than a Million Naira to rent you will be given a Tax notice

sense will not kill you

Nice one. It should be cut. I know of someone that paid 1.5 million to secure a job in firs...corrupt set of people.

supportnija:

How would the state collect their own VAT? If I buy N100 MTN recharge card in sokoto, my VAT is N1 which at the end of the month FIRS go to the MTN to collect this N1 in the head office in lagos. If VAT is going to start , it means , it should be calculate according to state consumption not according to present of the head office, you will see that, Lagos and rivers may ended up getting nothing. My problem with some of you is that your sentiment have overide you judgement

If you blv that those states wouldn't get nothing, then it shouldn't bother you lots!

There is no state with financial muscle like Lagos. In 2015, CBN said about 60% of all monies in circulation were in Lagos. It is not a question of who is stronger, Lagos can convenient carry 50% of Nigerian states on her backs. But other states have become docile, non-creative and leaching on few other productive states.

I am a data analyst. I work with media agency. We have to classify Lagos as a zone during media spent and spot analysis. Even with that, she usually surpass all other zones. Your recharge card that you bought in your state can easily be calculated and taxed in your state. I was working in a Conglomerate whose headquarter is in Lagos. I know for a fact that Oyo State govt collects tax on our branch in the state.

Una main problem is capacity. Y'all have been lazing around for too long, leeching on others while destroying businesses and innovation in the name of religion and did not see need to develop a working system. This might help y'all to do that. And Lagos can help you to set up a robust tax regime for a fee.

Canvass:
FIRS workers are just collateral damage to Wike's friendly fire. They should not forget that each state will have a more vibrant SIRS now, which will employ indegenes and create more employment opportunities than restrictive FIRS.

The employees can focus on the petroleum tax and other taxes and be managing that like that, so as to let the cookies go round, or resign their appointments at FIRS and go back to their various SIRS for employment.

On this VAT issue, Wike is right, regardless of whose head is rolling.

On point

Modrov:


The worrisome thing about this your scenairo is that

1.It could lead to multiple taxation.Under the new arrangement, Lagos is collecting VAT on the profits MTN earns in Nigeria, since MTN's HQ is located in Lagos, while Sokoto is again collecting VAT from MTN operations in its domain....meaning MTN can end up, theoretically, paying tax twice (unless MTN pays VAT on calls made in Lagos...which means Lag gets a reduction in the estimated amount they were expecting to collect in VAT. The same thing happens for other network providers.)

2.If Sokoto is not earning enough VAT from MTN consumption in its domain, it could increase the VAT a la true federalism since he who collects taxes also controls how much he pays...which will be passed on by MTN to the consumer in the form of 'high prices'

And as happens in Sokoto, it happens in other states too. A time could come where states increase VAT on MTN calls made in their state (and then there is the fun bit about calls made between states and to overseas).just to get extra money....either way MTN will pass the cost to us in the form of high prices.

We had this problem with right of way for telecom cables...where some states wanted to charge the earth vs some other states.

no state have collected VAT as at now.. so talks of reduced VAT is not in the question. Every state will now have inflows from VAT that wasnt there before.. however the net effect will come in the decrease from federal allocation. Trust me the net effect will favor Lagos than many other state because they currently receive far lower from FAAC than they generate.

for your 3rd paragraph, the likely effect is consumer will pay more tax depending on the tax rate of each state. it might be cheaper to make calls in lagos than another state with a higher tax rate. its currently 65 for lagos as against 7.5% for FG

Canvass:
FIRS workers are just collateral damage to Wike's friendly fire. They should not forget that each state will have a more vibrant SIRS now, which will employ indegenes and create more employment opportunities than restrictive FIRS.

The employees can focus on the petroleum tax and other taxes and be managing that like that, so as to let the cookies go round, or resign their appointments at FIRS and go back to their various SIRS for employment.

On this VAT issue, Wike is right, regardless of whose head is rolling.

sensible angle

ehinmowo:


If you blv that those states wouldn't get nothing, then it shouldn't bother you lots!

There is no state with financial muscle like Lagos. In 2015, CBN said about 60% of all monies in circulation were in Lagos. It is not a question of who is stronger, Lagos can convenient carry 50% of Nigerian states on her backs. But other states have become docile, non-creative and leaching on few other productive states.

I am a data analyst. I work with media agency. We have to classify Lagos as a zone during media spent and spot analysis. Even with that, she usually surpass all other zones. Your recharge card that you bought in your state can easily be calculated and taxed in your state. I was working in a Conglomerate whose headquarter is in Lagos. I know for a fact that Oyo State govt collects tax on our branch in the state.

Una main problem is capacity. Y'all have been lazing around for too long, leeching on others while destroying businesses and innovation in the name of religion and did not see need to develop a working system. This might help y'all to do that. And Lagos can help you to set up a robust tax regime for a fee.

Basically, at the end of the day, making states collect VAT is not going to benefit people.

1.Let's assume that ALL the states where alcohol is drunk collect VAT on alcohol consumed only in their state. At the end of the day, some states may decide that alcohol VAT is not earning them enough money, and then they may enact VAT increases, which leads to high prices for alcohol in some states...hits people's pockets.

Then there is the fact that Lagos is collecting VAT on monies paid at the alcohol company's HQ...that's another taxation...plus FG is still collecting its own.

2.In the telecom sector, let's assume that VAT is being collected only on calls made in each state. A state can decide that VAT collected from callis made in the state are too low...which could lead to increase in VAT. Guess who would be paying the price....all of us that don't live in the states concerned ...via higher VAT. Again, Lagos is collecting VAT on monies paid in their HQ.

3. Bread is eaten in Nigeria, and flour used is made in some states. Now under your new regime...VAT is charged on flour made in those states plus VAT is charged per loaf of bread sold. Price of bread goes up to cover the charges.

And so on and so forth.

Inasmuch as Wike and Sanwo-OLu have raised an important point...the remedy is worse than the disease it was meant to solve.

shogz89:
no state have collected VAT as at now.. so talks of reduced VAT is not in the question. Every state will now have inflows from VAT that wasnt there before.. however the net effect will come in the decrease from federal allocation. Trust me the net effect will favor Lagos than many other state because they currently receive far lower from FAAC than they generate.

Which is where the problem is. This is something that should have 'helped the South get back its money'...now we hear it is favouring Lagos alone? Okay.

for your 3rd paragraph, the likely effect is consumer will pay more tax depending on the tax rate of each state. it might be cheaper to make calls in lagos than another state with a higher tax rate. its currently 65 for lagos as against 7.5% for FG

So to make a cheap call, I have to leave my place of residence and travel to Lagos. Okay.....

Sometimes it is better we look before we leap.

Thanks for the clarifications.

ehinmowo:


If you blv that those states wouldn't get nothing, then it shouldn't bother you lots!

There is no state with financial muscle like Lagos. In 2015, CBN said about 60% of all monies in circulation were in Lagos. It is not a question of who is stronger, Lagos can convenient carry 50% of Nigerian states on her backs. But other states have become docile, non-creative and leaching on few other productive states.

I am a data analyst. I work with media agency. We have to classify Lagos as a zone during media spent and spot analysis. Even with that, she usually surpass all other zones. Your recharge card that you bought in your state can easily be calculated and taxed in your state. I was working in a Conglomerate whose headquarter is in Lagos. I know for a fact that Oyo State govt collects tax on our branch in the state.

Una main problem is capacity. Y'all have been lazing around for too long, leeching on others while destroying businesses and innovation in the name of religion and did not see need to develop a working system. This might help y'all to do that. And Lagos can help you to set up a robust tax regime for a fee.

RUBISH! Lagos does nothing , Lagos is advantaged nothing more

Modrov:


Which is where the problem is. This is something that should have 'helped the South get back its money'...now we hear it is favouring Lagos alone? Okay.



So to make a cheap call, I have to leave my place of residence and travel to Lagos. Okay.....

Sometimes it is better we look before we leap.

Thanks for the clarifications.

well you wont have to leave your state, if the state you reside have a low tax rate. We really dont know the power in tax in this part of the world. In advance countries, TAX is a political campaign tool that can win you election. Why do you think people prefer countires with low tax rate and tax haven, A favourable tax rate is enough to bring in massive investment in a state. We are gradually heading there

shogz89:
well you wont have to leave your state, if the state you reside have a low tax rate

.

Therein lies the problem.

Dwindling money from the federal account is going to push many states to charge higher VAT. This is not scare mongering....oil prices are too low for states to surivive on federal money, and increasing VAT is going to be the way forward

Plus, at the end of the day, the higher VAT in some states may be passed to all of us in the form of higher airtime costs. (Remember right of way payments in some states, and how experts were saying it means higher airtime tarrifs for all of us)

We really dont know the power in tax in this part of the world. In advance countries, TAX is a political campaign tool that can win you election. Why do you think people prefer countires with low tax rate and tax haven, A favourable tax rate is enough to bring in massive investment in a state. We are gradually heading there

Tax havens are countries like Antigua, Lichenstein and so on that 1) have very low populations 2) have no resources to speak of so they harbour people who can keep their money in their country in return for a little something...and even then....US is clamping down on citizens and companies that keep their money in tax havens (including sanctions).

Plus, there is the problem that companies producing in one state have to pay VAT on their production...then they sell to states who collect VAT on the product consumed. If that's not multiple taxation, what is?

Like now, Heineken Nigeria may pay VAT on product consumed in each and every state at different rates...some higher, some lower...plus they pay VAT on their profits in their lagos hq. This could lead to a point where Heineken costs vary from state to state...or Heineken increases prices to cover its additonal costs in paying VAT. eITHER WAY....it is Nigerians that would pay more...

Lolz they have been feeding fat with our money well na them sabi

supportnija:

How would the state collect their own VAT? If I buy N100 MTN recharge card in sokoto, my VAT is N1 which at the end of the month FIRS go to the MTN to collect this N1 in the head office in lagos. If VAT is going to start , it means , it should be calculate according to state consumption not according to present of the head office, you will see that, Lagos and rivers may ended up getting nothing. My problem with some of you is that your sentiment have overide you judgement

How myopic u concluded that Lagos and Rivers may end up getting nothing because of ur analysis. MTN and recharge card is not the basis of tax major beneficiary plus they even have the population to start with. They can never get nothing

Modrov:


Basically, at the end of the day, making states collect VAT is not going to benefit people.

1.Let's assume that ALL the states where alcohol is drunk collect VAT on alcohol consumed only in their state. At the end of the day, some states may decide that alcohol VAT is not earning them enough money, and then they may enact VAT increases, which leads to high prices for alcohol in some states...hits people's pockets.

Then there is the fact that Lagos is collecting VAT on monies paid at the alcohol company's HQ...that's another taxation...plus FG is still collecting its own.

2.In the telecom sector, let's assume that VAT is being collected only on calls made in each state. A state can decide that VAT collected from callis made in the state are too low...which could lead to increase in VAT. Guess who would be paying the price....all of us that don't live in the states concerned ...via higher VAT. Again, Lagos is collecting VAT on monies paid in their HQ.

3. Bread is eaten in Nigeria, and flour used is made in some states. Now under your new regime...VAT is charged on flour made in those states plus VAT is charged per loaf of bread sold. Price of bread goes up to cover the charges.

And so on and so forth.

Inasmuch as Wike and Sanwo-OLu have raised an important point...the remedy is worse than the disease it was meant to solve.

You are trying but not there yet. There aretoo many assumptions in your analysis. First, tax is one of the tools used to attract investors. Every learned tax experts knows that if you tightened your tax rate too much, you will lose business. I am working at a company that moves her headquarter from Lagos to Ogun because Ogun has a better tax holiday. Most tech companies today are moving to China because of better tax system. If you have a liberal tax system, you will get more. If you tightened it because u need more money, you will lose it.

That been said, everybody should really be concerned about how their state will collect their own VAT and leave those who has chatted a course on how they would alone. Nigeria is filled with "feeding bottle governors", who has no iota of innovation and wealth creation.

Lagos has spent billions in the entertainment industry and she us reaping billions in tax from that industry. Likewise other businesses. Now it will be very unfair for a state like Kano that ban circular songs to be sharing tax from that industry.

The only bottleneck I was expecting you to say is trans-state problem. If every state decided to collect tax on goods that passes through her state, then people farther away from the sea, AKA, northerners will have major problem. Because price of items will be very high by the time it gets up their. Conversely, agro products which are the main thing y'all supply down south are not VATable.

This is where collaboration comes in. Especially in trans-state tax. All SW States are working on harmonizing VAT. This may include expunging trans-state VAT within the region. This could be extended to other states. Such that if goods are coming from a particular state and vice-versa, no trans-state VAT. In all, this issue requires diplomacy. State governors MUST collect their own tax (VAT), no doubt. And anybody that is against that must be daft. But they need to sit down and straighten grey areas.

Cut it already

Useless people

ehinmowo:


You are trying but not there yet. There aretoo many assumptions in your analysis. First, tax is one of the tools used to attract investors. Every learned tax experts knows that if you tightened your tax rate too much, you will lose business. I am working at a company that moves her headquarter from Lagos to Ogun because Ogun has a better tax holiday. Most tech companies today are moving to China because of better tax system. If you have a liberal tax system, you will get more. If you tightened it because u need more money, you will lose it.

That been said, everybody should really be concerned about how their state will collect their own VAT and leave those who has chatted a course on how they would alone. Nigeria is filled with "feeding bottle governors", who has no iota of innovation and wealth creation.

Lagos has spent billions in the entertainment industry and she us reaping billions in tax from that industry. Likewise other businesses. Now it will be very unfair for a state like Kano that ban circular songs to be sharing tax from that industry.

The only bottleneck I was expecting you to say is trans-state problem. If every state decided to collect tax on goods that passes through her state, then people farther away from the sea, AKA, northerners will have major problem. Because price of items will be very high by the time it gets up their. Conversely, agro products which are the main thing y'all supply down south are not VATable.

This is where collaboration comes in. Especially in trans-state tax. All SW States are working on harmonizing VAT. This may include expunging trans-state VAT within the region. This could be extended to other states. Such that if goods are coming from a particular state and vice-versa, no trans-state VAT. In all, this issue requires diplomacy. State governors MUST collect their own tax (VAT), no doubt. And anybody that is against that must be daft. But they need to sit down and straighten grey areas.

THANKS for the reply

However, there are several issues that are still hanging for me...

1.Like the telco industries....your arrangement could lead to states eventually collecting VAT on calls made in their state, while Lagos continues to (theoretically) collect VAT on national profits in Lagos.

Which leads to the hard problem of states charging different VAT on calls made per state...whether North or South, leading to telcos paying as much as 37 different VATS, A SEPARATE VAT per state...some high, some low...which could lead to price increases.

(And if you think it won't happen, see the issue over right of way taxes for telcos...where some states wanted to increase the taxes)

2.Food products....let's use alcohol. In theory, states could charge VAT on alcohol consumed...plus VAT on alcohol produced in states with alcohol factories, plus Lagos charging VAT on alcohol proifts nationwide. This could lead again to alcohol being more expensive in some states compared to others...(and they won't all be Northern states)///or prices go up for alcohol nationwide.


That's my problem eventually with VAT...this is not about investment...and with

3.Dwindling revenues from oil due to low oil prices....states could see VAT as a means of ready money....VAT increases per state.

That's the issue for me.

Investors investing in one state or t'other has to do, from my limited understanding, with things like tax breaks on land tax, tax company pays for doing business in that state, not for VAT.

4.interstate issues are also very very important ( especially re vat on telcos)

supportnija:

I never blame you, I blame the institution that awarded certificate as a graduate.. you don't even UNDERSTAND what is VAT.

The guy is telling you the truth.. No state will collect more VAT than lagos regardless

Islie:




https://punchng.com/vat-row-firs-workers-fear-cut-in-salaries-bonuses/

They would be absorbed into respective States.

Christistruth00:


Too many Nigerian Billonaires pay next to Nothing they should get on their Case

Lagos should also introduce the Owambe Party Tax

Any Party Costing More than N2 Million Naira should be taxed at 50% especially the Obi Cubana type parties

Ole

KUKUMA carry them on your head now....