The Lagos State Government is going ahead with collecting Value Added Tax (VAT) to its accounts, following a landmark judgement that places the collection of VAT within states jurisdiction. 

Gbenga Omotoso, the state’s commissioner for information and strategy is quoted by Businessday as saying that the FIRS’ appeal before at the Appeal Court does not translate to a stay of execution and as such the state is legally backed to collect the tax.

“An appeal is not a stay of execution.

For us in Lagos, our position is that we have the backing of the law to demand and collect VAT.

The court has ruled and we are following the judgment,” Mr Omotoso is quoted as saying.

The state government had directed the FIRS to stop issuing demand notices for payment of VAT in the state and to render accounts, within seven days, of all sums collected as VAT in the current accounting circle in the state.

The state government premised its demands on the ruling of the Port Harcourt Division of the Federal High Court.

The court had last month declared the collection of Value Added Tax (VAT) and Personal Income Tax by the federal government unconstitutional, issuing a restraining order against the internal revenue.  

The landmark judgement implies that state governments can take the VAT payments in their jurisdictions.

FIRS responded to the ruling by appealing the ruling.

The revenue collection body added that it had filed a stay of execution, advising the public to continue regular payments to it.