Wike Signs Bills For VAT Collection, Anti-Open Grazing Into Law


Rivers State governor Nyesom Ezenwo Wike has signed the Open Grazing Prohibition Bill and the Value Added Tax (VAT) Collection Bill as well as the Residents Registration Agency and the Naming and Renaming of Infrastructure Bills into law.

The Rivers State House of Assembly recently passed the four bills into law.

Speaking at the ceremony in Government House, Port Harcourt, Wike stated that it was inimical to development and peace, for any state to condone opening grazing of cattle.

The governor said cattle rearing were agricultural business and the law, which has specified ranching, was so intended in order to stem clash between herdsmen who go to destroy farmland, crops, and having problems with farmers that lead to fighting and killing of themselves.

He said, “It is no longer a story. All of us know what our people have suffered in terms of this open grazing. Today all Nigerians have come to accept the reality that open grazing is no longer fashionable. Even our brothers in the north have agreed that it is no longer fashionable.”

Wike insisted that the judgement of the Federal High Court sitting in Port Harcourt had sufficiently addressed the illegality perpetrated by the Federal Inland Revenue Services (FIRS) on behalf of the federal government in the collection of VAT in states.

The governor stated that when agencies of the federal government are allowed to illegally demand and collect taxes meant for states to collect, they strangulate the states financially and turn them to be beggars.

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He said Rivers State is standing on the part of history by challenging the illegality of the federal government through the Federal Inland Revenue Services (FIRS).

“Of course, we are all aware that the states have already been strangulated. Most states depend on allocation from federation account. States have been turned to beggars. Hardly will any day pass that you won’t see one state or the other going to Abuja to beg for one fund or the other,” he said.

Wike stated that no campaign of calumny or blackmail on the part of FIRS would make what is illegal to become legal. He dismissed FIRS’ propaganda that 30 states will suffer if some states are allowed to collect VAT.

The governor further stated that the concerns should be on establishing whose duty is it to collect VAT and the constitutionality of such position before talking about who is going to suffer or not.

He said, “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 not 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.”

Speaking further, Wike said there are plans already for FIRS to introduce road tax and this is likely to take away more duties from the states, and further emasculate them financially.

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The governor said, “Which are the roads? Are they the roads the state government is paying for or the roads federal government has constructed? So, at the end of the day, they have taken over the functions of the state government and the state is left with nothing.”

He stated that the states have been so emasculated that they could barely survive without monthly revenue received from Federation Accounts Allocation Committee (FAAC).

Wike further stated that the over bearing attitude of the federal government, impinges on attaining financial autonomy for the legislature and the judiciary, since the states are not allowed to collect due revenues as specified by the country’s constitution.

The governor said with the Petroleum Industry Act (PIA) passed and signed into law, there shall be unbundling of NNPC, which means that NNPC remittance to the federation account will be less, requiring every state to look inwards on how to survive.

He thanked the state lawmakers for their courage to have given the bill speedy passage and assured that every area that the law allows the state to collect revenue will be maximised for the survival of the state.

On his part, the speaker of the Rivers State House of Assembly, Hon Ikuinyi-Owaji Ibani described the collection of VAT by FIRS as the worst form of retrogressive tax in any tax regime.

He commended the governor and the state government for challenging the constitutionality of FIRS collection of VAT in states. According to him, the signing of the VAT law will ensure that Rivers’ people are not plunged into extreme poverty.

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He said that Nigeria is the only country professing federalism but with a unitary constitution, which is the very opposite of what federalism stands for.

Speaking further, he said the law banning open grazing in Rivers State would serve as both cure to the symptom and the disease of herders and farmers bloody conflicts.