Stakeholders including the Ogun State Internal Revenue Service OGIRS, Civil society organizations and other Interest groups have expressed strong support for the Value Added Tax being considered by the State House of Assembly
They described the bill titled "A Bill For A Law To Impose And Charge Value Added Tax On Certain Goods And Services, Provide For The Administration Of The Tax And Other Related Purposes" as a true reflection of fiscal federalism,during their various submissions on Thursday at a public hearing organizehebd by the House Finance and Appropriation Committee at the assembly's complex in Oke-mosan Abeokuta
The stakeholders stressed the need for true fiscal federalism between the Federal Government and federating units
Chairman of OGIRS, Mr. Gbenga Olaleye suggested the inclusion of e-commerce because of digital operations of some of the companies, to further shore up the revenue to be generated from collection of VAT as consumption that should be collected by the state ,since it is not included one of the items listed on the exclusive list of the 1999 constitution of Nigeria as amended
Olaleye also hinted that the revenue agency had proposed introduction of Brand Identification Number for companies operating in the state, to ensure they pay their V AT charges to the State Government and not Lagos State where most of their Corporate Headquarters are located
He added that the proposal would be included in its memoranda to be submitted to the house for consideration in the final draft of the bill
The OGIRS however disagreed with most of the stakeholders canvassing for reversal of the proposed 70-30percent sharing formular between the State Government and Local Government Area where VAT are generated
According to him, the sharing formular is fair enough for both tiers of government, to initiate developmental projects in the interest of the people
He also called for stiffer punitive provisions for defaulting companies who failed to register their premises within a month of operations in the state
The bill recommends fine of N50,OOO and subsequent penalty of N100,000 for defaulters which the State Chairman of Campaign For Defence of Human Rights CDHR, Comrade Yinka Folarin rejected and called for a review downward to be between N10,000 and N20,000
Also contributing the State Commissioner for Industry, Trade and Investment, Mrs.Kikelomo Longe represented by a Director in charge of Industrial Promotion, Engr. Kehinde Akintomide, Chairman of Association of Nigerian Authors in the state, Engr.Paul Oni, former member of the house, Hon.Habeeb Ajayi who operates one of the hotels in Abeokuta, all praised the house for initiative, saying Ogun State is among the highest contributors of VAT just like Lagos and Rivers but not benefiting from the present sharing formular after collection by the Federal Inland Revenue Service FIRS
The Speaker of the house, Right Honourable Olakunle Oluomo in his response, expressed strong support for those making case for the Loca Government in the proposed sharing formular, saying it will strengthen the administration of the local governments in the state
Oluomo and the House Finance and Appropriation Committee Chairman, Kunle Sobukanla assured stakeholders of the consideration of their suggestions in the further consideration and final draft of the bill before passage
The Speaker noted that the South West Conference of Speakers was already putting in place more feasible modalities to enhance the collective development of the Southwestern States, with a view to further promoting effective service delivery and charting the path towards true fiscal federalism.
Assuring stakeholders of speedy passage of the bill, the Speaker noted that it had become imperative to improve the internally generated revenue of the State to aid the implementation of more socio- economic development in all parts of the State.
The State Assembly is taking after Rivers and Lagos State whose legislative arms had already passed the VAT Bill now being implemented in the two states, despite legal tussle with the Federal Government through FIRS whose role is being challenged for collecting VAT not included on the exclusive list of the constitution
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