The dispute between the Federal Inland Revenue Service and some states over the collection of Value Added Tax seems to be taking a new turn by the day as two more states, Ogun and Akwa Ibom, say they are ready to enact laws that will enable them to collect the tax in their states.

This is as some employees of the FIRS are currently in panic mode over the recent moves by states to begin collection of Value Added Tax, Sunday PUNCH has learnt.

Three members of the FIRS workers’ union told one of our correspondents that stripping the FIRS of the power to collect VAT could reduce the commission the agency would have received by as much as N96bn.

The FIRS had stated in a document submitted to the National Assembly that it projected it would be able to collect N2.44tn from both import and non-import VAT in 2022.

The FIRS, which takes four per cent of the amount collected as VAT as its commission, projected it would receive N96bn in 2022.

Should the states begin collecting VAT, the FIRS would lose this huge sum, a top source within the tax body told one of our correspondents.

The source said, “Our highest source of revenue is Petroleum Tax and VAT. Others include Stamp Duty, Company Tax and a few others. VAT is number two for us and we are paid bonuses based on performance.

“If we stop collecting VAT, the FIRS will not be able to pay bonuses and other special packages to staff. As it is, many of us are scared because we don’t know what will happen next.”

Another senior employee told Sunday PUNCH that the FIRS had hired too many staff members and its wage bill was high. He said the service might be forced to reduce its workers once VAT payment was taken away.

Another employee said, “One big problem we have in the FIRS is that almost every big politician has a relative in this agency due to the system of patronage we run in this country, whereby political office holders are given slots. The implication is that we have too many workers and our wage bill and overhead cost are high. We will be lucky if some of us are not sacked.”

Out of the FIRS’ N216.65bn budget for the 2021 fiscal year, the sum of N107.52bn is for personnel cost; N47.22bn for overhead cost; and N61.9bn for capital cost.

As of 2019, the FIRS had about 9,000 staff members but the figure is believed to have increased since then.

The agency has been criticised for frivolous expenses such as setting aside N160m to sew uniforms for 850 drivers and budgeting N825m for refreshment and security vote of N250m, among others in 2019.

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.

SarkinYarki:
The Federal Govt using it's corrupt Judges will defeat the State in this VAT debacle in both the appeal and Supreme court then the state Govts will go on to implement a version of VAT at state level called the Sales Tax ..at the end of the day it's the poor masses that will bear the brunt

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.

Truthissupreme:
Appeal court, or supreme Court won't give a verdict to support FG because there is no where in the elusive list where it defines FG to collect VAT on a state.

The highest at best is they collect from federal import export inflow

The high court decision doesn't make it any easier for FG too that's why they want to force NASS to pass emergency law

But at the time of the case ruling it's still governed by the original law which Lagos State is officially using

SarkinYarki:


The same Supreme court we have seen passing magical verdicts? . Don't play yourself ..those people are very corrupt

SarkinYarki:


The same Supreme court we have seen passing magical verdicts? . Don't play yourself ..those people are very corrupt

joyandfaith:


FG might not win this. Collection of taxes is not exclusive list of FG. States can make laws.
You may be right though.

AntiBMC:
Well they have to adjust cos change is constant, and unlike the yeye change Bulhari promised in 2015, this change spearheaded by Wike is good.

Every state should collect its VAT. Not d one that Kano will destroy people's alcohol businesses and still, collect the VAT for the alcohol. That's an injustice.

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

DubaiLandLord1:
Lol


Lagos will end up getting nothing, but Sokoto will get a lot of things

Nairaland is so funny, a place where a bigot go dey accuse someone else of been a bigot

Even if every states dey collect their VATs, Lagos go still be number one.

supportnija:


Your problem is that you refuse to learn, 35 states in nigeria cannot buy, withraw money from the bank because their head office in Lagos , they are the one to get the tax. I just give example of N1 to tell you Lagos may not be as you think.

supportnija:


Your problem is that you refuse to learn, 35 states in nigeria cannot buy, withraw money from the bank because their head office in Lagos , they are the one to get the tax. I just give example of N1 to tell you Lagos may not be as you think.

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

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.

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!

DubaiLandLord1:
All this your wailings, I no dey understand am. Maybe people wey dey import fuel, go start sailing with their ships on land from Lagos to Sokoto or you think nah just a single state in the south south Mobil, Oando etc dey drill oil from in the south south.

There is no way a state like Sokoto, Home, Kebbi etc will generate more VATs than Lagos State.

I will leave you with your ignorance sha, states in the South West like Ogun are about to follow LASG and RSG path, you can keep on wailing on Nairaland.