By Michael Ojo
A Federal High Court sitting in Lagos has ruled that the amemdment of Tax and Levies Act(2004) by the Minister of Finance, an agent of the executive arm of government, is inconsistent with the provisions of the constitution, and therefore void.
Justice Ayokunle Faji of the court held that the Nigerian constitution vests powers to make laws on the National Assembly. “Any purported amendment” to the Act 2004 by the Minister, “is null, void and unconstitutional.”
The judge upheld the argument of The Registered Trustees of Hotel Owners and Managers Association that “only the National Assembly can amend laws. No other body can do so.”
The Attorney-General of the Federation and Minister of Finance were the defendants in the suit.
The Federal Government through the then Minister of Finance and Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala, on May 26, 2015, amended the Schedule to the Act following pressure to harmonise taxes and levies payable in Nigeria.
The amendment introduced “a taxing power” to state governments over “inter alia: Hotels, Restaurants or event centres’ consumption tax, where applicable.”
But The Registered Trustees of Hotel Owners and Managers Association, whose members in Lagos State are charged with the responsibility of collecting consumption tax from its customers on behalf of the government, filed Suit No: FHC/UCS/1082/19, challenging the Minister’s action.
The judge agreed with plaintiff’s Counsel Mr Salihu Bello that, among others, the amendment “…affects the business of Plaintiff and its members particularly as regards payment of taxes.
“It affects them directly. It seems to me that they are entitled to challenge a law which seeks to determine the point of payment of tax as regards their business if they think that law is unconstitutional.”
The judge granted all the plaintiff’s four declarative reliefs.
Justice Faji held: “By virtue of Section 4 of the Constitution…the legislative powers of the Federal Republic of Nigeria are vested in the National Assembly
“The Minister of Finance, being a member of the executive arm of government, lacks the constitutional power legislative competence) to amend an Act of the National Assembly or any part thereof.
“Section 121 of the Taxes and Levies (Approved List for collection Act Cap T2 Laws of the Federation of Nigeria 2004 which vests the Minister of Finance with the power to amend the schedule to the Taxes and Levies Approved list for Collection) Act is inconsistent with the provisions of the Constitution…and therefore, unconstitutional, null and void.
“Any purported amendment to the taxes and levies (Approved List for collection Act Cap T2 Laws of the Federation of Nigeria 2004 by the Minister of Finance…including but not limited to the ones and Levies (Approved List for collection) Act (Amendment) Order, 2015 is illegal constitutional, null and void.”