Federal High Court dismisses FIRS application for stay of execution on VAT judgement

The Federal Inland Revenue Service (FIRS) filed an application for a stay of execution of the judgment of the Federal High Court (FHC) in the case of Attorney General of Rivers State v. FIRS & Attorney General of the Federation[1]. The FHC had held that the State Governments, not the FIRS, has the power to collect Value Added Tax (VAT), Personal Income Tax (PIT) and other taxes not exclusively assigned to the Federal Government by the Nigerian Constitution. Please click on this link to access our previous alert on the ruling.

This application for a stay of execution by the FIRS sought to halt the enforcement of the FHC’s decision pending the hearing of the appeal filed by FIRS at the Court of Appeal. The FHC however heard and dismissed FIRS’s application for a stay of execution on 6 September 2021, stating that granting the application would negate the principle of equity and amount to the Court overruling itself.

This FHC ruling further creates uncertainty around VAT compliance for taxpayers based in Rivers State, as both the RSG and the FIRS have released communications to taxpayers requesting remittance of VAT. We expect the FIRS to file another application for a stay of execution at the Court of Appeal. In the meantime, we will continue to monitor the progress of FIRS’ appeal and the turn of events in Rivers State.


[1] Suit No. FHC/PH/CS/149/2020

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