We understand that the Lagos State government today lost its case filed at the Supreme Court challenging the powers of the federal government (FG) to collect Value Added Tax on goods and services supplied in the state. The Lagos State government had sued the FG seeking for a ruling to repeal the VAT Act on the basis that it was outside the legislative remit of the FG to collect the tax. The court however ruled in favour of the preliminary objection of the Attorney General of the Federation on behalf of the FG that the Supreme Court does not have original jurisdiction in the matter as it was a dispute between an agency of the FG and Lagos State and not a dispute between the FG and the Lagos State government. This is on the basis that VAT is collected by the Federal Inland Revenue Service which is an agency of the FG.
Lagos State has promised to explore other avenues to resolve the dispute.
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.