GRPolitics

[OPINION] Wike, VAT and the Quest for True Federalism

Published

4 years ago

August 20, 2021

Justice Okamgba

By Chidiebere Nwobodo

“Boldness is not second to everyone, it is intentionality.”
— Janna Cachola

History is being made in Rivers State. There is a bold move by the State Government at challenging the retrogressive status quo of the federation. Nigeria’s political structure is not only lopsidedly skewed against the states but has become a clog on the nation’s wheel of progress. Like local government areas, the states are mere appendages of the behemoth center—yet we call this country “Federal Republic of Nigeria”. It is feeding bottle federalism!

The rattling question is: what is federal about a country structured along unitary system by respective military dictatorships. In the last few years, there has been vehement agitations for a restructured Nigeria that will encompass true federalism where states will have the needed autonomy and resources to determine and unleash their socio-political cum economic destinies.

Failure to make any meaningful progress in the direction of restructuring, in the last few years, has birthed agitations for self-determination, especially in southern Nigeria. Restructuring advocates are opposed to separatist campaigners calling for total balkanization of the country. While true federalists believe that Nigeria can still be salvaged via restructuring, self-determination proponents have been pummeling them for not walking their talk.

Rivers State Government has changed the game. Age-longed problems cannot be solved by persistently and indefinitely talking about them without action. There comes a time in history when courageous and well-calculated actions are left to do the talking because all talk and no action makes someone a rabble-rouser reveling in ramblings. Rivers State decided to confront the hydra-headed monster of unitary structure that made states subservient to the center.

The bone of the contention is Value Added Tax (VAT).

Recently, Rivers State Government went to court to challenge Federal Government’s collection of VAT via Federal Inland Revenue Service (FIRS). It argued that FIRS did not have the constitutional right to collect VAT and Personal Income Tax (PIT) on behalf of local governments, states and federal government. It advocated that states should be allowed to collect VAT—and not Federal Government.

On August 9, Justice Stephen Pam of Federal High Court, Rivers State, ordered the tax agency of the FG, the FIRS and the Attorney General of the Federation, from collecting VAT and Personal Income Tax (PIT) from residents of Rivers State. Federal Government via FIRS fumed and vowed to appeal the judgement.

Rivers State Government did not stop there, it ensured that the State Assembly legislated on it through a bill, which was swiftly signed into law on August 19, 2021, as Value Added Tax Law No. 4 of 2024 by the man behind the wheels—Governor Nyesom Wike. I doff my cap for this courageous move of Rivers State Government.

There are insinuations in the media that FIRS is lobbying National Assembly to put VAT in the exclusive list, in order to legitimacy its illegality—to continue the exploitation, and but this move is dead on arrival. I am sure that even all other states will sleep and allow the agency to ambush the states using National Assembly, Rivers State Government under the leadership of Governor Wike will not allow this to happen.

Governor Wike has demystified the bogus term called restructuring cum true federalism. It is not rocket science. He has proved that easiest way to handle mountainous challenge is by compartmentalization of it. My own definition of restructuring of which Governor Wike has accentuated, is using legitimate avenues to get back your resources and power that were illegally taken away using military regimes.

Back to issue at stake—VAT.

Value Added Tax (VAT) was introduced in 1993. The sharing formula; states—50%, LGAs—35% and FG—15%. FIRS gets 4% from FG’s share as operational cost. But the subject of controversy had been whose duty it was to collect VAT—states or FG via FIRS? but the judgement of Federal High Court has lent credence to narratives of restructuring advocates; though FIRS said it has appealed the historic judgment. Let wait and see how it goes. But why is it running to National Assembly if it has water-tight case?

VAT falls under consumption tax, which is within the state government power to collect and remit 15% to the Federal Government. Majority of the VAT are generated from the states, which gave them lion share of 85% in the sharing formula. Why then should FIRS, on behalf of Federal Government, collect VAT and distribute to the state? Did states complain that they lack capacity to collect VAT?

What is the work of states Internal Revenue agencies responsible for Internally Generated Revenues (IGR)? Why will a minority stakeholder in a company be the one collecting revenues, especially when the revenues are being generated from the states—majority stakeholders? Sadly, this illegality cum impunity had gone on unchallenged for decades. As a restructuring advocate, I am happy Rivers State Government has taken the bull by the horn to correct this obnoxious practice of “monkey dey work bamboo dey chop”.

FIRS collection of VAT from states and distributing same via the Federation Accounts Allocation Committee (FAAC), is tantamount to robbing Peter to pay Paul. Majority of the VAT remitted to FAAC monthly comes from just few economically viable states with high volume of VAT generation like Lagos, Rivers, Ogun, Delta, Enugu, Akwa Ibom, etcetera, yet other states get rewarded for indolence and crass unproductivity—the reason Nigeria is economically backward—and poverty capital of the world.

FAAC shared a total of N733 billion as June, 2021 revenue, out of the sum, VAT revenue got N143.6 billion—huge chunk of the VAT came in from alcohol consumption. Look at the injustice and irony here, majority of Sharia-compliant states that routinely destroy alcoholic beverages in their states, did not only partake in revenues from VAT but got lion share of it—going by the hegemonic template of using number of states and local government councils to share revenues.

Why will someone drink beer in Lagos and another person in Kano State that detest alcohol as a result of religious belief gets more share in the distribution of VAT emanating from the produce? This is wickedness taken too far. I strongly stand with Governor Nyesom Wike and Rivers State Government on this courageous step to end this official theft.

Other state governments with huge volume of VAT generation should throw their weight behind Rivers State and see this to a logical conclusion. This is the real battle for a restructured Nigeria. The die is cast. Governor Wike has shown leadership where it mattered mostly and should be railed round. There is a weighty allegation that FIRS illegally withholds some VAT it collects on behalf of the states—it remits only a fraction of what truly comes into it coffers.

States do not control FIRS; its operations and recruitment process, thereby cannot efficiently monitor its modus operandi yet FIRS generates most of its revenues from the states. Ideally, FIRS should not collect VAT outside Abuja—FCT; where FG has substantial control of its Internally Generated Revenues. It VAT collection influence should be limited to FCT alone.

While signing the historic Value Added Tax bill into law, Governor Wike could not hide his ill feelings towards impunity of Federal Government using FIRS to strip states of their VAT revenues, of which made state governors to always go cap-in-hand begging for financial support from the center. He was quoted as saying:

“In this (Rivers) state, we awarded contract to companies and within the last month we paid over N30billion to the contractors and 7.5% will now be deducted from that and to be given to FIRS.

“Now, look at 7.5% of N30billion of contracts we awarded to companies in Rivers State, you will be talking about almost N3billion only from that source. Now, at the end of the month, Rivers State government has never received more than N2billion from VAT. So, I have contributed more through the award of contracts and you are giving me less. What’s the justification for it.”

With this calculated move that has quaked the foundation of the FIRS and rattled Federal Government, Governor Wike has become the Moses of our time leading true federalists to the promise land of a restructured Nigeria. We are morally bound to give him all the support.

GRPolitics

Tinubu Hails Winners of By-Elections in 12 States

Published

1 month ago

August 17, 2025

grassroots

President Bola Tinubu

President Bola Ahmed Tinubu congratulates all the winners of Saturday, August 16, by-elections in 16 constituencies across 12 states.

The President commends the Independent National Electoral Commission (INEC) for the hitch-free elections, mostly devoid of violence.

Following the results declared by INEC, the All Progressives Congress (APC) won in 12 constituencies, the All Progressives Grand Alliance (APGA) won in two, the Peoples Democratic Party (PDP) won in one, and the New Nigeria Peoples Party (NNPP) won in one.

President Tinubu congratulates the new APC National Chairman, Prof Nentawe Yilwatda, for the emphatic first victory recorded under his leadership.

He also congratulates the APC governors and other leaders on the success of the by-elections.

“Chairman Nentawe Yilwatda has shown leadership capacity and demonstrated what is achievable when popular candidates are fielded and with unity of purpose among party leaders,” the President remarks.

“To all APC faithful and the electorate, thank you for the confidence reposed in our party. Be assured that our Renewed Hope slogan is not a mere slogan. Our destination is a better, more secure and prosperous Nigeria. We shall take you there, by the Grace of God,” he said.

President Tinubu commends all the political parties and candidates who participated in the election and enjoins them to continue to be guided by the spirit of sportsmanship, fair contest and magnanimity, which are enablers of enduring democracy.

GRPolitics

FG: President Tinubu Fulfilling Development Promises to South-East

By Sandra Ani

Published

1 month ago

August 17, 2025

grassroots

President Bola Tinubu's appointees on tour of South East

The Minister of Information and National Orientation, Mohammed Idris, has restated the Federal Government’s firm commitment to the rapid socio-economic development of Ebonyi State and the entire South-East geo-political zone.

Speaking in Abakaliki on Friday night at a Citizens’ Engagement Forum organised by his Ministry, the Minister said: “The commitment of Mr. President to the socio-economic development of Ebonyi State and the entire South-East is unwavering. He is right on track to transform and move the region forward, as promised when he came here to campaign in November 2022.”

The Minister explained that the Citizens’ Engagement Forum is not a mere talk shop but a direct platform to present government’s scorecard, give account of stewardship, and take feedback from Nigerians.

“This is consistent with the mission of the Federal Ministry of Information and National Orientation to reenact trust in public communication by deepening the social contract between government and citizens, and restoring public confidence in governance.”

Highlighting major achievements of the Tinubu administration, Idris noted that subsidy removal and other bold reforms have doubled allocations to states and local governments, fueling an “unprecedented explosion of infrastructure projects across most states of the country.”

The Minister said “the Port Harcourt-Aba railway project has been completed, delivered, and is in operation,” while the Federal Executive Council has approved “the allocation of $3 billion for the completion of the 2,044km Eastern Rail Line, projected to unlock N50 billion for the region in annual trade.”

In addition, “$508 million has been earmarked for the upgrade and modernization of Eastern Port infrastructure,” while “118.85km of the Ebonyi section of the Calabar-Abuja Super Highway has been inaugurated.”

On healthcare, the Minister disclosed that “the Federal Government, in April 2025, flagged off the Cancer Centre of Excellence at the David Umahi Federal University of Health Sciences, Uburu,” adding that a “world-class Oncology Centre at the University of Nigeria Teaching Hospital, Nsukka” has also been commissioned.

To support small businesses, Idris stated: “The Federal Government, through the Bank of Industry, injected about N200 billion into nano, micro, and small businesses, benefitting over 900,000 business owners.”

He further announced that the newly established South-East Development Commission has “hit the ground running in its pursuit to build a $200 billion economy for the region by 2035,” while the South-East Investment Corporation, with a capital base of N150 billion, will drive industrialization and inclusive growth.

On security, the Minister assured citizens that the Federal Government is winning the war against insurgents and secessionist elements. “We have recorded great success in making the South East safe and rendering the sit-at-home orders by secessionists ineffective,” he stressed.

Idris commended Governor Francis Nwifuru of Ebonyi State for his development strides, especially in forging synergy with the Federal Government to deliver impactful projects for the people of the state.

“His success across all sectors of the state is a testament to what is possible when state and federal governments work in synergy to deliver dividends of democracy to the people.”

The Minister reiterated President Tinubu’s vision of building a $1 trillion economy, bridging the infrastructure gap, promoting food security, improving the living conditions of the masses and bequeathing a prosperous nation to future generations. “Indeed, we are not resting on our oars,” he affirmed.

GRPolitics

2027: Again, Enugu North Endorses Gov Mbah over Massive Projects, UNN VC

SANDRA ANI reports that Governor Mbah told the people “…You ain’t seen nothing yet”

Published

1 month ago

August 10, 2025

grassroots

Governor Peter Mbah addressing the people of Enugu North Senatorial District after they endorsed him for second term.

…Says Enugu-Nsukka rail line in the pipeline

Stakeholders and groups across the six Local Government Areas of Enugu North Senatorial District, also known as Nsukka Zone, have endorsed Dr. Peter Mbah of Enugu State for a second term in office yet again.

The stakeholders, comprising traditional, political, and community leaders, professionals and various groups, said the governor had shown sincerity and determination in addressing the major challenges facing Nsukka Zone through visible projects, while also facilitating the appointment of a son of the zone as the Vice Chancellorship of the University of Nigeria, Nsukka, for the first time since the founding of the institution in 1960.

This was as Mbah revealed that he was already in the process of feasibility study for a rail line that would reduce trip from Enugu to Nsukka to 15 minutes, saying he was just starting.

The people of Nsukka zone bared their minds during Governor Mbah’s working visit to Nsukka at the weekend, which featured the foundation laying for a 5,000-shop capacity Nsukka International Market, meeting with traditional rulers of the zone at Edem Ani, and a well-attended meeting with stakeholders of the zone.

Speaking, the Chairman, Enugu State Council of Traditional Rulers, Igwe Samuel Asadu, said the zone had presented three major requests before Mbah ahead of the 2023 election, namely; the dualisation of the 44km Abakpa Nike-Opi-Nsukka Road, appointment of an Nsukka Zone indigene as Vice Chancellor of UNN, and support the creation of Adada State.

“Today, the governor is already dualising the Enugu-Opi-Nsukka Road. Just last week, he, through his good relationships with President Bola Tinubu, ensured the emergence of Professor Simon Ortuanya as the Vice Chancellor of UNN. While the creation of Adada State is not for him to decide, he has given us all the support to push for it.

“It means that he has met almost all our demands in just two years. So, tell me why we will follow another person other than him?”, he said.

nsukka zone and Mbah — *Governor Peter Mbah addressing the people of Enugu North Senatorial District after they endorsed him for second term.*

In his remarks, the Chairman of Nsukka LGA, Engr. Jude Asogwa, said Mbah was unstoppable, as far as Enugu north was concerned, saying he had surpassed their expectations.

“Our people said that I should inform you that you are unstoppable. We thank you for the 20 Smart Green Schools in Nsukka, 20 Type-2 Primary Healthcare Centres, and the Modern Transport Terminal in Nsukka, just to name a few, all in just two years.

“So, we want to tell you that we are committed to your cause. In fact, it is as though Enugu just started two years ago. We don’t engage in frivolities and we are on ground for you,” Asogwa stated.

In his opening remark at the townhall meeting, which held at the UBA Hall, UNN, Member representing Nsukka/Igboeze South Federal Constituency, Hon. Chidi Obetta, said Mbah had shown that leadership was no rocket science, noting that the essence of the townhall meeting was for the governor to get undiluted feedback from the people.

“The Enugu North zone is saying thank you because I know a lot of projects across various sectors you have told me in our private discussions that you were planning to bring to Nsukka” he said.

Mbah, while responding to their requests which were mostly in appreciation for the projects done and request for more roads, assured the zone that he would get even more aggressive with roads construction in 2025 by which time he would have been done with the 260 Smart Green Schools and the 260 type-2 Primary Healthcare Centers.

“I know you are all excited about the Abakpa-Opi-Nsukka Road. But you ain’t seen nothing yet. We are also going to do a rail line from Enugu to Nsukka. We don’t think that travelling from Enugu to Nsukka should take you more than 15 minutes. We are still doing the feasibility studies. But this is something we will do,” he said.

Other eminent personalities of Enugu North at the events, which featured a question and answer session with the governor, include the Deputy Speaker, Enugu State House of Assembly, Hon. Ezenta Ezeani; Member representing Igboeze North/Udenu Federal Constituency, Hon. Dennis Agbo; Labour Party candidate in the 2023 governorship election, who has also returned to the Peoples Democratic Party, Hon. Chijioke Edeoga; and Commissioner for Energy and Mineral Resources, Enyinna Franklin Ogbonna.

Also present were members of Enugu State House of Assembly representing the zone, the six Council Chairmen of the zone, among others.