The Federal High Court sitting in Lagos has dismissed the Bolt operators’ suit challenging the Federal Inland Revenue Service’s (FIRS) authority to charge, collect, and remit Value Added Tax (VAT) on transportation and food services provided by independent drivers and vendors operating via the Bolt platform.
Justice Akintayo Aluko dismissed the suit while affirming the verdict of the Tax Appeal Tribunal, which upheld FIRS’s authority in this regard, Channel Television reports.
Recall that the Bolt operators had filed the suit before the Tribunal, seeking, among other reliefs, an order restraining the tax agency from imposing VAT on services offered by independent drivers and vendors.
They argued that such action allegedly violated Section 10 of the VAT Act.
The Tribunal dismissed the Bolt drivers’ suit on May 26, 2023.
Legal Dispute
Dissatisfied with the Tribunal’s ruling, the Bolt operators’ legal team, led by Elvis Asia, appealed to the Federal High Court, seeking to reverse the decision.
They sought a declaration that their appointment by FIRS as agents responsible for VAT compliance on behalf of independent suppliers contravened Section 10 of the VAT Act.
They argued that the Tribunal erred by affirming their appointment as FIRS agents under Sections 10(3) and (6) of the Act without considering other relevant provisions.
They also accused FIRS of wrongly categorizing non-resident suppliers like Bolt as taxable suppliers of goods and services provided by Nigerian vendors.
The appellants urged the court to hold that Bolt itself does not engage in transportation or food vending and thus cannot be treated as a taxable supplier under the VAT Act.
They further urged the court to reverse the Tribunal’s decision, which had dismissed their case for lack of locus standi (legal right) to commence the suit.
Responding to their claims, FIRS’s counsel, Moses Idaho, urged the court to dismiss the appeal with substantial costs.
He described the appellants’ claims as speculative and a misrepresentation of the Tribunal’s ruling.
What the Court Said
In his judgment, Justice Aluko awarded N1 million as the cost of the action in favour of FIRS against the Bolt operators.
The court held, “Going by the evidence relied upon by the Tax Appeal Tribunal as revealed in the Records of Appeal, which form the basis of its judgment under scrutiny, the Respondent acted within the law in appointing the Appellant pursuant to Section 10(3) of the VAT Act. There is no valid reason to disturb the judgment of the Tribunal. Consequently, the judgment of the Tribunal delivered on 26th May 2023 is affirmed.”
The judge concluded that the appeal fails and is accordingly dismissed.
