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VAT Dispute: Umahi Begs Governors To ‘Sheathe Their Swords’

Ebonyi State Governor, David Umahi, has appealed to state governors to sheathe their swords as the dispute over who should collect Value Added Tax (VAT) between the state governments and the Federal Inland Revenue Service (FIRS) persists.

He believes if the FIRS is stripped of such responsibility, only a few states will be major beneficiaries while others will be left to suffer.

“Even if you have all the money in the world, you will not be able to use it. So, it is very important, and it is coming at a very bad time,” the governor said on Friday.

“I’m pleading with my colleagues to sheathe their swords, let us pass through this challenging moment before we start looking at who is right or wrong.

“We have to be our brother’s keeper; we have to see how we can grow the economies of the weakest states, otherwise we will breed a lot of insecurities to those super states; this is very important.”

A series of litigations and rulings have surfaced since the Rivers State government took the decision to test the legality of the collection of VAT by FIRS in various states.


The dispute started on August 9 when a Federal High Court in Port Harcourt granted the state government the right to collect VAT – an order that affected other states.

Although the case is before the Supreme Court, the latest is the reservation of the ruling of the Court of Appeal in Abuja, on the application for a joinder filed by the Lagos State government.

But Governor Umahi proposed that before states should be allowed to collect VAT, the ‘weakest states’ must be provided with enough resources to give them a comparative advantage.

According to him, the Federal Government should be the major contributor to VAT while state and local governments should have 85 per cent and the remaining 15 per cent taken by the Federal Government.

“Now, the Federal Government and the super states will be the most beneficiaries, and a number of states will collapse and by the reason of rampant law,” the governor decried. “I am also encouraging the Federal Government to look the way of Ebonyi State, we are highly disadvantaged.

“You say we should grow the economy, with what? We don’t have money to grow the economy. We have agriculture, we have solid minerals, and our solid minerals are being stolen away. Ebonyi State should be pitied, we’re in a very difficult situation. We have a lot of our youths unemployed.”

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