Nigeria

Activist asks court to compel Kano, others to refund VAT generated from alcohol

Justice I.M. Sani of the Federal High Court sitting in Port Harcourt, Rivers State has convicted and sentenced two false whistle blowers- Dominic Okem and Chukwunonso Igweonu, to two months imprisonment each for conspiracy and giving false information

An Abuja-based activist, Sesugh Akume, has filed a suit before a Federal High Court in the nation’s capital, asking it to compel states that outlawed the sale of alcohol to refund the sums received through Value Added Tax imposed on alcoholic beverages.

About 12 states practise Sharia law in Nigeria. They are Kano, Kaduna, Katsina, Kebbi, Sokoto, Borno, Yobe, Jigawa, Bauchi, Gombe, Zamfara and Niger. Based on Sharia law, some of the states prohibit the sale of alcoholic beverages and usually hold public events where bottles of alcoholic drinks are destroyed while gambling is also illegal.

However, all the states receive VAT collected from alcoholic beverages sold in other states that permit the sale of the product.

In an originating motion brought pursuant to Section 1(3), 4(5), 162(3), (4) and 163 of the constitution and Section 6(1) of the Economic and Financial Crimes Commission Act, the lawyer put four issues before the court for determination.

Listed as respondents are the Attorney-General of the Federation and the EFCC.

In the case with suit number FHC/ABJ/CS/275/2021, Akume asked the court to determine if the wilful destruction of alcoholic beverage bottles was not economic sabotage.

He also asked the court to determine whether it is a contradiction to destroy bottles of alcoholic beverage while benefiting from VAT from the same product.

Akume also sought six reliefs including an order that the production, transportation and sale of alcoholic beverages are not forbidden in Nigeria by the Nigerian constitution and that any law criminalising it is unconstitutional.

The activist is also seeking an order compelling the EFCC to determine and publish the extent of financial loss incurred by the destruction of alcoholic beverages.

He is also seeking a declaration that, “retaining and utilising any allocation, VAT or any funds distributed by the Federal Government is not mandatory as any recipient – state or local government – may refund same to the Federal Government or give to others.”

In a supporting affidavit deposed to by the applicant, Akume stated that Nigeria generates huge funds from the production and sale of alcoholic drinks, adding that it constitutes the 4th highest VAT revenue in the country.

Akume said between January and September 2019, N31.8bn in VAT was generated from breweries.

He added, “Some states in the country have been notorious for destroying alcoholic beverage bottles, wasting the content. The Kano Hisbah Board for instance, on Friday March 12, 2020, destroyed 34,000 bottles of different alcoholic beverages.

“The practice continued and on September 27, 2013, it destroyed 244, 151 bottles of alcohol.”

He said besides Kano, Jigawa had also engaged in such practice.

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