News
Falana Says Judgement on VAT Will Strengthen Campaign for Restructuring
Mr. Femi Falana, human rights lawyer, has, said the judgement of the Federal High Court in Port Harcourt, which ruled against the administration and collection of Value Added Tax (VAT) by the Federal Inland Revenue Service (FIRS) not only corroborated the struggle for restructuring via litigation, but also strengthened the campaign.
Falana urged all state governments to team up with Rivers State Government to defend the judgement.
However, Falana warned that the FIRS should not be prevented from collecting VAT, pending the hearing and determination of the appeal. He said dispute over the enforcement authority of VAT, should not call for anarchy.
The lawyer added that, if implemented, Lagos State Government, believed to contribute about 70 per cent of VAT, would be the greatest beneficiary, followed by the Federal Capital Territory (FCT) with 15 per cent contribution to VAT.
Falana, a former President of the West African Bar Association (WABA), also contended that it was evident in the 1999 Constitution of the Federal Republic of Nigeria (as Amended) that VAT, “is neither listed in the Exclusive Legislative List nor on the Concurrent Legislative List.”
The legal luminary spoke in response to THISDAY’s enquiries on whether or not Rivers State Value Added Tax Law No.4 of 2021 was enacted in contravention of the provisions of the 1999 Constitution.
Justice Stephen D. Pam of the Federal High Court in Port Harcourt had ruled that the FIRS lacked constitutional authority to enforce and administer taxes not expressly stipulated under Items 58 and 59 of Part I of the Second Schedule to the 1999 Constitution.
Emboldened by the judgement of the Federal High Court, the Rivers State House of Assembly duly passed the State Valued Added Tax Bill No. 4 of 2021, whichMr. Nyesom Wike, state governor, subsequently signed into law.
FIRS said in a statement by Abdullahi Ahmad, irector of Communications and Liaison, advised taxpayers to continue remitting their VATs to the federal agency or face stiff penalties if they failed to honour their tax obligations.
But Falana, in response to THISDAY’s inquiries, explained away the constitutional provisions for the administration, collection and enforcement of VAT in relation to the power of the FIRS under the Value Added Tax Act, 2007, which had its foundation in the Decree No. 102 of 1993.
He said the judgement of the federal high court was consistent with Items 58 and 59 of Part 1 of the Second Schedule of the 1999 Constitution, which according to him, did not encompass the VAT or consumption taxes.
On this ground, according to him, the court decision that the Rivers State Government and not the federal government was constitutionally entitled to impose VAT, enforceable or collectable in its territory was in order.
Based on the judgement, the senior advocate challenged other states of the federation to file applications to join the case at the Court of Appeal as interested parties to defend the judgement of the Federal High Court.
Specifically, Falana explained that other state governments “will have to join Rivers State to defend the judgement of the Federal High Court. They are entitled to join the suit at the appellate court because any order from the appeal will affect them.”
Falana pointed out that in view of the valid and subsisting judgment of the Federal High Court, the Rivers State Value Added Tax Law No. 4 of 2021, “has not impugned any provision of the 1999 Constitution (as Amended).”
He said the judgement “will provide an opportunity for the appellate courts to review the contradictory judicial authorities on the legal status of VAT. Actually, there is a lacuna in the 1999 Constitution. The lacuna is that VAT is not on the Exclusive Legislative List, which was the basis of the judgement.”
The senior advocate explained that the judgement of the federal high court, “has confirmed the struggle for restructuring via litigation. That means that the judgement will strengthen the campaign for restructuring.”
Falana also observed that the judgement, “has a lot of implications for the dwindling revenue of the state and local governments across the federation,” which according to him, reinforced the call for other state governments to join the suit at the appellate court.
“VAT was increased from five per cent to 7.5 per cent last year by the National Assembly. Right now, VAT collected is between N1.5 trillion and N1.8 trillion per annum.
“VAT is fully collected by the federal government and payable into the federation account for distribution among the three tiers of government. Even though state governments have joined the campaign for resource control, the judgement is not in favour of the majority of them.
“If the judgement is implemented, the Lagos State Government, which contributes about 70 per cent of VAT, will be the greatest beneficiary. The Federal Capital Territory will be the next beneficiary with 15 per cent contribution to VAT.
“Apart from Rivers and about four other states that will benefit minimally, not less than 30 states will be adversely affected as they contribute little to the VAT. It is expected that apart from FIRS, which is allocated four per cent from VAT as cost of collection, other state governments may file applications to join the case at the Court of Appeal as interested parties.
“It is also interesting to note that the judgement does not affect the collection of import VAT on international trade. The judgement requires all stakeholders to take advantage of the current constitutional review to examine the collection of VAT as it is neither in the exclusive nor in the concurrent legislative lists under the 1999 Constitution.
“Since an appeal to the Court of Appeal together with a motion for stay of execution had been filed, the FIRS had simply enjoined all parties to allow the status quo to remain.”
He said FIRS should not be prevented from collecting VAT, pending the hearing and determination of the appeal. He said the dispute over the enforcement authority of VAT “is not a call for anarchy.”
Rather, according to the senior advocate, the process was meant to ensure that appeal that had been filed by the FIRS was not rendered nugatory. That was the practice in Nigeria, when the rule of law reigned supreme.
Falana also expressed reservations about the administration of President Muhammadu Buhari in terms of upholding the rule of law.
He lamented that the Buhari administration “has put the rule of law in abeyance by saying that court orders should pave the way for national security. A regime that has disdain for the rule of law cannot turn round to insist on compliance with court orders.”
To compound the crisis, Falana acknowledged that Rivers State Government “has enacted a Value Added Tax Law. The effect is that the law takes precedence over the practice of suspending action until the hearing and determination of the motion of the FIRS for stay of execution.
“As soon as the vacation of the courts ends, the FIRS will ensure that the trial court hears its motion for stay. If the motion is granted, the status quo remains but if it is refused the Rivers State Government will continue to collect VAT under the new law, because of the serious issues involved in the case, the legal battle will be pursued up to the Supreme Court.”
Benjamin Kalu, deputy Speaker of the House of Representatives, has emphasized the critical role of parliaments in promoting multilateralism through digital trade.
Kalu, according to a statement by his Chief Press Secretary (CPS), Levinus Nwabughiogu, stated this at the World Trade Organization/Inter-Parliamentary Union (WTO-IPU) Steering Committee session of the WTO Public Forum 2025 on the sidelines of the ongoing 55th Parliamentary Conference, Geneva, Switzerland.
The statement noted that the deputy speaker, who spoke on the theme “Promoting Multilateralism Through Digital Trade: What Role for Parliaments?”, stated that digital trade is a defining contemporary governance challenge that shapes the daily reality of entrepreneurs and the future opportunities for youth.
He stated that that Africa is proactively building its own regional multilateralism through the African Continental Free Trade Area (AfCFTA) and its Protocol on Digital Trade, aiming for a harmonized and integrated digital market.
Kalu, while citing Nigeria’s legislative actions, including the Nigeria Data Protection Act of 2023 and the forthcoming National Digital Economy Bill, stressed that parliaments across Africa are also actively legislating the future of digital trade.
According to him, “the digital economy is no longer a distant promise; it is the daily reality of our entrepreneurs and the horizon of opportunity for our youth. In Africa, we have chosen not to wait for others to write our future.
“Through the African Continental Free Trade Area (AfCFTA) and its Protocol on Digital Trade, we are building our own regional multilateralism, a blueprint for a harmonized, integrated digital market.
“But blueprints alone do not build houses. Success depends on the laws we pass, the trust we create, and the predictability we guarantee. In Nigeria, we have acted: the Nigeria Data Protection Act of 2023 safeguards privacy, while the forthcoming National Digital Economy Bill will anchor e-commerce and investment in legal certainty.
“Across Africa, parliaments are not spectators; we are legislating the future. Let us be frank, rules without enforcement are illusions. For smaller economies, a binding, two-tier dispute settlement system is not optional; it is survival.”
He added that “we all know that speeches do not build futures; actions do. For us to move to coordinated action, I propose three steps: a Legislative Tracking Mechanism that engenders peer‑to‑peer accountability, requiring us to report back on how we translate our collective resolutions into concrete action within our national parliaments; Concrete WTO support for AfCFTA implementation to further deepen digital trade in Africa; and a Model Digital Trade Legislative Toolkit developed with UNCTAD and ITC, to equip parliaments with best-practice laws for a pro-development digital economy.”
Nigeria has upgraded its passport production system to meet global standards, now able to process up to 5,000 passports every day.
According to TVC, Dr. Olubunmi Tunji-Ojo, minister of Interior, disclosed this during an inspection of the new Centralised Passport Personalisation Centre at the Nigeria Immigration Service headquarters in Abuja.
He explained that the development is part of President Bola Ahmed Tinubu’s Renewed Hope Agenda, which has cleared backlogs and ended long delays in passport processing.
According to him, Nigerians can now get their approved passports within 24 hours.
“The era of backlogs and manual personalisation is over. Nigerians can now expect faster, more reliable service as we strengthen the integrity of our travel documents,” Tunji-Ojo said.
The Minister added that Nigeria has now joined countries like the United States, the United Kingdom, France, and India in adopting advanced passport systems that ensure speed, transparency, and global authentication.
He also commended the Permanent Secretary, Dr. Magdalene Ajani, Comptroller-General of Immigration, Mrs. Kemi Nandap, and other key officials for their contributions.
Tunji-Ojo stressed that the project, delivered through a partnership with IRIS Smart Technologies Ltd., was achieved without direct government funding.
“This project underscores our resolve to build enduring institutions rather than systems dependent on individuals,” he said.
With the new system, production has moved from 250–300 booklets per machine daily to between 4,500 and 5,000.
The Minister described the achievement as a major milestone in Nigeria’s 62-year Immigration Service history, saying it has restored confidence in the country’s travel documents.
News
AfDB Approves Equity Investment in The Currency Exchange Fund to Support Access to Local Currency Financing Across Africa
The Board of Directors of the African Development Bank Group has approved an equity investment of USD 25 million in The Currency Exchange Fund (TCX), a global leader in offering long-term local currency hedging solutions in emerging and frontier markets.
This strategic investment will strengthen TCX’s capital base, enhance its risk-bearing capacity, and expand its ability to offer hedging instruments in illiquid and less liquid currencies across the African continent.
The transaction will help mitigate the foreign exchange risks faced by borrowers in Africa, particularly those operating in fragile states and underserved markets. TCX operates as a development-focused fund that provides tailor-made FX hedging instruments to enable local currency lending in countries where conventional hedging markets are either underdeveloped or non-existent.
The Bank’s investment will crowd in additional DFIs and private investors, reinforce Africa’s integration into global capital markets, and support sustainable growth by reducing the mismatch between the currency of debt and revenue for local borrowers.
Ahmed Attout, Director of the financial Sector Development Department, at the African Development Bank Group, stated: “This investment in TCX marks an important milestone in the Bank’s effort to deepen African capital markets and address the root causes of debt distress. The Bank’s support to TCX will unlock local currency financing for MSMEs, infrastructure and many sectors across Africa.”
He added : “The transaction forms part of the Bank’s broader objective to promote access to adequate financing through innovative alternative solutions.”
The investment builds on the Bank’s prior participation in TCX and reflects its continued confidence in the fund’s track record and impact-driven model. TCX has hedged more than USD 17 billion in notional amounts since inception, including over USD 4 billion across 31 African countries.
The Bank’s participation is expected to facilitate increased hedging volumes in priority sectors such as the public sector (Debt Management Offices and Public Development Banks), infrastructure, energy access, microfinance, and SME development. TCX also plays a unique role in fragile and low-income countries, with around 18% of its global outstanding portfolio currently focused on such markets.
Ruurd Brouwer, TCX’s Chief Executive Officer stated : “We are thrilled to welcome African Development Bank Group to TCX’s capital base, joining fellow development finance institutions, impact investors and governments that support our local currency hedging solution. It marks the start of a close partnership in protecting AfDB’s public and private sector borrowers from currency risk and promoting the development of African capital markets. We very much look forward to increasing our joint impact on the continent.”
This operation is aligned with the Bank’s Ten-Year Strategy 2024–2033. It complements the Bank’s broader capital markets strategy, which includes support for local currency bond issuance, Partial Credit Guarantees, and private sector local currency lending.
The investment is expected to deliver strong development impact. The African Development Bank remains committed to fostering resilient capital markets in Africa, supporting de-risking mechanisms for the private sector, and expanding access to local currency finance to promote inclusive and sustainable development.
Afreximbank Decries $330Bn MSME Financing Gap in Africa
Airtel AI Blocks 84 Percent of Spam SMS in Nigeria
Kalu Champions African Digital Trade Multilateralism
Kenya Airways Pays NCAA Sanction over Passenger Rights Violation
Nigeria Launches 24-Hour Passport Processing, Boosting Capacity to 5,000 Daily
E-Financial2 days agoFCMB Partners Truecaller to Reinforce Customer Communication, Trust
News2 days agoAfDB Approves Equity Investment in The Currency Exchange Fund to Support Access to Local Currency Financing Across Africa
E-Financial2 days agoDon’t Spray, Mutilate Naira – CBN
General News2 days agoWhy Elon Musk Halted Sales of Starlink in Lagos, Abuja
Broadcasting2 days agoGlo-sponsored African Voices Features Star Author, Chimamanda Adichie
News2 days agoShoprite Struggles to Stay Afloat as Stores Shut across Nigeria
Telecom2 days agoGoogle Expands Digital Infrastructure with Four New Subsea Cable Hubs and $9m AI Fund for Africa
E-Business2 days agoFG Plans to Make 95 Percent of Nigerians Digitally Literate by 2030