In a Friday judgement, Justice Haruna Simon Tsanami ordered that the bill enacted by the Rivers State House of Assembly and signed by Governor Nyesom Ezenwo Wike be put on hold.
The injunction came just hours before Lagos State Governor Babajide Sanwo-Olu signed the VAT law.The appeal court's ruling came in response to a request by the Federal Inland Revenue Service (FIRS) for a stay of execution of a Rivers State high court's judgement in the case.Wike recently signed a bill to collect Value Added Tax (VAT) in the state into law.
At the Government House in Port Harcourt, he signed a bill just passed by the state House of Assembly.He said that the Federal High Court's decision in Port Harcourt adequately addressed the illegality committed by the Federal Inland Revenue Service (FIRS).
The bill was also passed unanimously by the Lagos State House of Assembly on Thursday.The court, however, ordered a perpetual injunction prohibiting the FIRS and the Attorney-General of the Federation, Abubakar Malami, from collecting, demanding, threatening, and pressuring Rivers citizens to pay FIRS, personnel income tax, and VAT.
The state governments of Rivers and Lagos have already passed legislation to give effect to the VAT verdict.
An earlier application by the FIRS to the Rivers high court to suspend the judgment's implementation was denied on Monday by Justice Stephen Dalyop Pam, who reasoned that the application would undermine the concept of fairness because the state legislature had previously approved a legislation on VAT collection.