Connect with us

GRPolitics

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

Published

on

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.

Continue Reading

GRPolitics

Tinubu 2023: It will only be fair for politics to pay back – Hashim Suleiman

I wish all the APC elites the wisdom needed to act appropriately towards 2023.

Published

on

Tinubu returns
Tinubu returns from foreign medical treatment

I have repeatedly believed and said Asiwaju Bola Ahmed Tinubu is the most progressive politician in Nigeria alive because he has demonstrated it with Lagos even though people argue that the level of the development is not commensurate with the revenue but they forget that even the revenue itself they are discussing is the handiwork of the man and they should equally remember that no other state has utilized as much as he has albeit selflessly for the development of the state and the people.

For these and more, I have immense admiration and respect for the man.

I was moved to write today’s piece after waking up to barrages of photographs to the effect that Asiwaju is back from his medical sojourn and it has become a trending topic in the country and beyond and I’m aware only critical people get this much free advertisement and for the positive for that matter because all I see is some sort of celebration by so many.

Another video of the launch of SWAGA 2023 is also trending alongside the return photographs. If these don’t attract an attention for a write up, what will do more.

Let me go a little deeper to analyze how Tinubu has been a man of very few words since the advent of this administration and that left him out of the mainstream media for most of the time but regardless of that you cannot erase or not come across his footprints everywhere through his mentees and the work they do regardless of whether some of them have chosen to be snitches or not.

Regardless of his being quiet and respecting himself to a large extent, people have refused to let him drink some water and drop the cup without attempting to dig dip and make a meaning out of a simple personal medical trip for example, when did it become a crime to get ill and seek attention. However, that is the price of leadership and one that is consequential so one can understand.

For those who do not know, Tinubu had been in politics for practically all his life, even his little stint at the private sector was all about his efforts at expanding his network and forging a democratic front that he wanted to see Nigeria key into also. That left him in so many controversial circumstances including exile and so on.

They persevered until they finally succeeded and Obasanjo rode on the sympathy of their activities to become the president while Asiwaju became the governor of Lagos state and the rest is now history.

Fast forward to today and check the empire that Tinubu has been able to build around the south west and Nigeria at large, some people misconstrue him to be a regional leader but I see those people as not critical enough to understand that people are free to maintain their identity while pursuing whatever, so yes Tinubu is a Yoruba man but for all the time his political party the ACN has produced northern presidential candidates in Ribadu and Atiku Abubakar other than the AD which produced Olu Falae in 1999 for obvious reasons.

You cannot erase a jew’s identity regardless of his being an American and loving America to death.

Asiwaju has demonstrated maturity and a sense of love for Nigeria while maintaining his identity and this is what any reasonable persona should do, in fact it should be a virtue that should demonstrate people who can be trusted, people who are not hypocrites.

Having said all these, I thought it was only fair for politics to pay back such an individual in whatever capacity. There are those who argue within the APC that Asiwaju must be cut to size and I ask for what crime?

For working together to provide a platform for them to come to a position they would have only dreamt of in their lifetime? This must be the highest form of treachery if indeed there are people who discuss that sort of narrative in the party.

Some of them were not born when Tinubu started to contribute to this venture and his own type is not theirs because he has been committed to ensuring the provision of mentorship and development of people who came across him.

Is it because of all these qualities that they hate him or because they are intimidated and envious that they have not amassed as much goodwill. APC must be truthful to itself and engage Asiwaju appropriately for whatever outcome the 2023 would bring. At the last count before his return to Nigeria last night, 58 top politicians have visited Tinubu at his London home including President Muhammad Buhari. Asiwaju is also firmly in charge of Lagos State, one of the top economies in Africa.

He has his network built over years and you would only want to toil with such a politician at your own peril. Growing up, they always told us that politics always pays those who worship her.

I wish all the APC elites the wisdom needed to act appropriately towards 2023.

Hashim Suleiman can be reached via [email protected]

Continue Reading

GRPolitics

[JUST IN] PDP Committee Zones National Chairmanship Slot To North

Published

on

The next national chairman of the Peoples Democratic Party (PDP) will emerge from the northern region of the country, the party’s National Zoning Committee has announced.

This decision was contained in a communique issued on Thursday following the meetings of the committee held in Enugu and Abuja.

“The decision of the PDP Zoning Committee is in line with the Constitution of the party on zoning and rotation of party and national offices in the interest of justice, equity, and fairness,” the statement read.

“Consequently, the current offices being held by officers in the southern zones of the country, namely South West, South East, and South South zones, should swap places with the offices currently in the northern zones of Nigeria, namely North West, North East, and North Central zones.”

The committee is headed by Governor Ifeanyi Ugwuanyi of Enugu State, while Benue State Governor, Samuel Ortom, and Zamfara State Deputy Governor, Mahdi Mohammed, are deputy chairman and secretary respectively.

Constituted on September 9, it was given the mandate to zone national offices to be contested by all PDP members at the party’s forthcoming national convention.

PDP’s National Executive Committee had announced October 30 to commence the exercise.

However, the mandate of the committee does not include zoning of the offices of the president, vice president, as well as other executive and legislative offices in the country.

The committee stated that its decision to zone the party’s offices does not in any way affect the executive and legislative offices in Nigeria.

It explained that the zoning of offices within the PDP has traditionally been between the North and South of the country.

The committee thanked the party’s leadership, especially the National Executive Committee for finding its members worthy to serve the PDP in that capacity.

Continue Reading

GRPolitics

Nigeria To Deploy 5G Network By January 2022 – Pantami

Published

on

Dr. Isa Pantami

Nigeria is almost at the advanced stage to start deploying the fifth-generation (5G) cellular networks from January 2022, the Minister of Communication and Digital Eeconomy, Isa Pantami has said.

He revealed this during a town hall meeting in Maiduguri, Borno state, on Thursday through his representative, Ubale Maska, NCC commissioner for technical services.

He said the deployment became necessary as there are over 50,000 telecommunications sites across the country and about 16,000 outages recorded by mobile network operators (MTN, Glo, Airtel, 9mobile) between January 2021 and July 2021.

Pantami blamed the outages on fibre cuts, access denial and theft, leading to service disruption in the affected areas.

The Minister who condemned situations where telecoms installations were destroyed in terrorist attacks which had not been replaced as a result of the intense security issues and tensions in north-east states, urged the national assembly to speed up the passage of the Critical Infrastructure Protection Bill for onward submission to Muhammadu Buhari for assent.

Continue Reading

Trending