Connect with us

Economy

VAT In Nigeria: Wike Drags FG To Supreme Court

Published

on

VAT In Nigeria: Wike Drags FG To Supreme Court

Value Added Tax (VAT) in Nigeria controversy has taken a new turn, as Governor Nyesom Wike of Rivers State, dragged the federal government to a Supreme Court.

As reported on Newsrand, a Federal High Court sitting in Port Harcourt, had on Monday, August 9, 2021, declared that the Rivers State Government and not the Federal Inland Revenue Service (FIRS) should collect VAT in the state.

Following the Federal High Court ruling, the matter was taken to the court of appeal, which on Friday, September 10, held that parties should refrain from giving effect to the judgment of the trial court in Port Harcourt pending the hearing and determination of the application of the FIRS to stay execution of the trial court’s judgment.

Not pleased with the appeal court’s order, Wike approached the Supre Court to challenge the ruling that all parties in the matter should maintain status quo in the VAT in Nigeria dispute.

As seen in the notice of appeal, amongst other things, the Rivers State Government is arguing that the “Justices of the Court of Appeal erred in law when they relied on the provisions of Section 6(6) of the Constitution and the inherent jurisdiction of the court to found their decision to make an order to maintain status quo which they identified as restoring the parties to the position they were before the judgment of the Federal High Court in FHC/PH/CS/149/2020 was delivered on 9th August 2021.”

Rivers State is also of the opinion that “the learned Justices of the Court of Appeal erred in law when they wrongly assumed jurisdiction to entertain the oral application for the maintenance of status quo made by the counsel for the Federal Inland Revenue Service (the 1st Respondent herein) in spite of the fact that a condition precedent to the invocation of the jurisdiction of the Court of Appeal was not fulfilled by the first respondent.”

What is VAT in Nigeria

Newsrand understands VAT in Nigeria is a consumption tax paid when goods are purchased and services are rendered. It is charged at a rate of 7.5%.

How states shared VAT revenue from FAAC between January 2020 and February 2021

  • Lagos -N153.94 billion
  • Kano -N32.48 billion
  • Oyo -N29.85 billion
  • Rivers -N28.43 billion
  • Kaduna -N24.75 billion
  • Katsina -N22.72 billion
  • Delta -N20.91 billion
  • Bauchi -N20.49 billion
  • Anambra -N20.14 billion
  • Jigawa -N20.13 billion
  • Nasarawa -N15.36 billion
  • Bayelsa -N15.79 billion
  • Taraba -N16.23 billion,
  • Gombe -N16.33 billion
  • Kwara -N16.35
  • Ekiti -N16.46 billion
  • Yobe -N16.90 billion
  • Abia -N17.03 billion
  • Ebonyi -N17.04 billion
  • Cross River -N17.17 billion

Analysis

e-Naira: All You Need to Know About Nigeria’s Digital Currency

Published

on

What is the e-Naira?

The e-Naira is simply Nigeria’s digital currency. The e-Naira is also called a CBDC, which means Central Bank Digital Currency. It’s the Naira but digital. The e-Naira is not a crypto-currency, but it uses technology for digital currencies.

Why the e-Naira?

The eNaira will enable direct remittance payments between Nigerians within and outside of the country. The launch of the e-Naira also means Nigeria would be the first African nation to publicly issues its own CBDC.

The Introduction of the e-Naira means payments would be faster, another big deal is the fact that the e-Naira is going to be cheaper for the CBN and the users, for the CBN – They don’t have to deal with the logistics of printing and moving Naira notes, for the users it means no transaction fees between wallets unlike when bank account holders try to send money from one bank to another and are charged a fee for the transaction

When would the e-Naira launch?

The e-Naira is set to launch on the 1st of October, Nigeria’s independence day.

Who is making the e-Naira?

Global fintech company, Bitt, is partnering with the Central Bank of Nigeria (CBN) to roll out the e-Naira.

In his official statement, Chief Executive Officer of Bitt, Brian Popelka, said “Bitt is proud to partner with the Central Bank of Nigeria to launch the first live retail CBDC in the largest economy in Africa. We’re especially proud to do so in a country that’s well known for its fintech leadership.

Digitizing the Naira will benefit the entire Nigerian financial ecosystem. The financial and humanitarian benefits that our technology offers will be transformative, especially in the lives of those 50 million unbanked Nigerians.”

In choosing Bitt Inc, the CBN will rely on the company’s tested and proven digital currency experience, which is already in circulation in several Eastern Caribbean Countries. Bitt Inc. was key to the development and successful launch of the central bank digital currency (CBDC) pilot of the Eastern Caribbean Central Bank (ECCB) in April 2021.

Who is Bitt.inc?

Bitt is a Financial Technology company that utilizes blockchain and distributed ledger technology to facilitate secure peer-to-peer transactions with seamless mobile money across a suite of Bitt’s Software and Mobile Applications.

Why did CBN select Bitt Inc?

“The CBN’s selection of Bitt Inc, from among highly competitive bidders, was hinged on the company’s technological competence, efficiency, platform security, interoperability, and implementation experience.

“In choosing Bitt Inc, the CBN will rely on the company’s tested and proven digital currency experience, which is already in circulation in several Eastern Caribbean Countries. Bitt Inc. was key to the development and successful launch of the central bank digital currency (CBDC) pilot of the Eastern Caribbean Central Bank (ECCB) in April 2021,” the CBN said.

Where do you save your e-Naira?

The e-Naira would be housed in what the CBN calls a “Speed wallet.”

Anyone who does not have a bank account can use the “Speed Wallet.” Users must, however, provide a passport photo, their name, birth date and place, a phone number, and their address.

According to the CBN, the Speed wallet isn’t in competition with existing banks but another means of transaction until a time where other banks can plug into the digital wallet with their own infrastructure or technology. The Speed wallet has 3-Tiers.

Tier 1 of Speed wallet (Basic)

Sending & Receiving e-Naira has a fifty-thousand Naira limit, with the minimum requirement to using a Tier 1 wallet being a phone number that will be validated as the individual’s National Identity Number (NIN). A cumulative balance of three hundred thousand Naira is fixed each day.


Tier 2 of Speed wallet.

Users of Tier Two wallets must have an existing Nigerian bank account. The user is limited to sending and receiving 200,000 Naira per day, with a daily Cumulative Balance of 500,000 Naira. The minimum requirement for this level is a Bank Verification Number (BVN).


Tier 3 of Speed wallet.

Tier three allows for a million Naira in daily transactions and a daily cumulative balance of five million Naira. To be eligible, you must have at least a BVN. Those with this merchant level can send and receive a million Naira per day. A merchant, on the other hand, can deposit as much money as they want into their bank accounts.
In context, the Central Bank also stated that neither Merchants nor Customers who use the wallet will be charged a fee.

Continue Reading

Economy

EXPLAINER: Is Aboki fx Nigeria’s forex enemy?

Published

on

EXPLAINER: Is Aboki fx Nigeria's forex enemy?

Aboki fx has been making news headlines since Friday, September 17, 2021, that the Central Bank of Nigeria (CBN) held its 280th Monetary policy committee (MPC) meeting in Abuja.

As reported on Newsrand, the apex bank, in the course of the meeting, wondered how Aboki fx determined how naira traded at the parallel market as against the dollar and other foreign currencies.

Addressing his audience at the meeting, CBN governor Godwin Emefiele said Aboki fx had done nothing good to the Nigerian economy, but only milked it by manipulating the exchange rate for self-gratification sake.

EXPLAINER: Is Aboki fx Nigeria's forex enemy?
Governor Godwin Emefiele of the Central Bank of Nigeria (CBN)

Refering to the founder of the forex platform, Emefiele stated: “Mr. Oniwinde Adedotun started the AbokiFX operation in 2015 and has since milked the economy by manipulating the exchange rate.”

“Adedotun lives in London while concorting criminal activities on our economy. Our preliminary findings show that the company continues to file the same cash account in the United Kingdom whereas he maintained about 25 accounts with 8 banks in Nigeria, milking the system and collecting cash through Automatic Teller machines in London.

“He then sells tens of millions in FX to company’s in Nigeria; we will go after them all,” the CBN governor added.

About Aboki fx

Prior to the existence of Aboki fx, Nigerians who wanted to change their currencies in the parallel market could only do so sourcing for information manually -via phone calls and Bureau De Change (BDC) operators on the roadside.

Having discovered that there is an opportunity to launch a digital platform that can provide information on forex, especially as it relates to naira valuation, Aboki fx came into play and in over six years of its existence, it served as the information destination for currency traders, investors, business owners, and other news platforms.

Trouble for Aboki fx, however, started after CBN halted forex sales to BDC operators a month ago. Immediately after the action which set tongues wagging among economy stakeholders, the value of naira started going on a downward spiral trend.

But is the platform Nigeria’s economy enemy as claimed by Emefiele?

It is pertinent to note that Aboki fx is an information providing website (news platform). As such, it is expected that accurate data and factual figures are what would be exposed to its audiences.

Sadly, according to the CBN chief, this was not the situation in the case of the forex news portal.

However, while Aboki fx might not be the enemy of Nigeria’s forex, one cannot deny the influence it had in the exchange market.

It is an open secret that quite a number of news organisations depend on Aboki fx to get how naira traded against the dollar. And it is worrisome that not many cared to know how Aboki fx was securing its forex information, especially as it relates to naira performance in the black market.

This writer is of the opinion that CBN thought Aboki fx’s action to publish falsified exchange rates was an agenda setting theory in nature. In this case, it was believed that the platform was publishing rates it wanted members of the public to believe without securing approval to do so from regulatory bodies like the apex bank.

Like other news platforms, Aboki fx has roles to play in not setting the public up against the government. Misinformation could mean many things in this case, one of which could be poor economic policies by the Nigerian government.

Continue Reading

Economy

Naira To Dollar: Aboki Fx Explains How It Get Information On Forex

Published

on

Naira To Dollar: Aboki Fx Explains How It Get Information On Forex

As Naira to dollar continues to drop in value, the Central Bank of Nigeria (CBN) had blamed the development on Aboki fx, a live exchange rate platform.

According to the apex bank, Aboki fx was fond of manipulating the forex market with rates, which was endangering the Nigerian economy.

Governor Godwin Emefiele who made this known at the just-concluded 280th Monetary policy committee (MPC) meeting held on Friday, September 17, 2021, however, assured that Aboki fx founder Oniwinde Adedotun would be prosecuted.

Emefiele further wondered if members of the public were ever curious about how Aboki fx secures the information it publishes on forex, especially on how the naira was valued.

Responding to the CBN governor, Aboki fx explained that it usually gets its information from bureau de change operators in Lagos.

“None of our data source providers know who we are or what their rates are being used for. This is to avoid any manipulation of rates. Our staff has a daily routine of going to the market to gather rates as all the BDCs in the country have their rates clearly displayed on their rates board and parallel market dealers give the information away freely. All we do is collate all that information and display it on all our platforms daily,” the firm said in a statement seen by Newsrand.

As regards allegations of fraud levelled against its founder by the CBN governor, the company said such allegations were not proven.

The firm said it doesn’t trade forex and it had always stated this on social media.

“Aboki FX purely provides benchmark parallel rate information which helps guide our users in almost 200 countries across the world. Aboki fx does not trade fx which we have always maintained in our emails and social media platforms,” it added.

Continue Reading

Trending