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Outrage as PHED effects 7.5% VAT increase on January bills

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Electricity consumers in Port Harcourt, Rivers state and other states covered by the Port Harcourt Electricity have raised the alarm over perceived ‘fraudulent 7.5percent value added’ tax hidden in their January bills.

It was gathered that although the electricity company stated that VAT charges on the January bill was 5%, a keener look revealed that it was based on the new 7.5% rate that took effect from February.

Our investigations revealed that thousands of consumers could be unwittingly paying 50percent more in the January bill that were distributed by the company in early February because of the misleading ‘5% VAT’ claim.

The worst affected consumers were maximum demand (MD) consumers, including Vintage Press Limited, publishers of The Nation and Sporting Life titles, MDAs, oil service firms and others that their bills usually runs into hundreds of thousands or millions monthly.

VPL’s Regional Internal Auditor, Mr. Oluranti Samson Oyediran, said it took the eagle-eye of a manager in the Port Harcourt Regional office to spot the sharp practice in the company’s January 2020 bill.

“Although the bill states that VAT was 5%, our calculations revealed that we were actually charged 7.5% of the electricity consumed for the period.”

A PHED staff, who confirmed that similar bills were sent to other companies and high consumers known as MDs, lambasted a staff of VPL who protested the arbitrary VAT charge.


“I am aware that you have written a frivolous letter to the General Manager Commercial, but I don’t know why you are complaining because hundreds of other companies received similar bills and did not complain,” the PHED staff (names withheld) said last Saturday during a meter-reading visit to the company.

Oyediran noted that VPL’s Current Charge of N1,606,596.39 for the month of January attracted a VAT if N120,494.73, adding, “What this shows clearly is that despite the fact that they stated that VAT was billed at 5%, what my company was actually charged was 7.5%. This is not only fraudulent, but it is very disgraceful for a public company to engage in this kind of practice.”

“It is pertinent for us to state here that the upward review of VAT from 5 to 7.5percent took effect from 01 February 2020, in line with Finance Law.”

Already, he disclosed that the company had written to the management of PHED’s Garden City East Operations in D-Line, Port Harcourt to demand a reversal of the arbitrary charge.

Meanwhile, it was gathered that aggrieved consumers have threatened to drag the company before the Economic and Financial Crimes Commission (EFCC) from fraudulent increase in the January VAT charge.

Attempt to get the electricity company’s comment on the controversy was fruitless, since February 19, when the company received our letter.


Lady Decency
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