WorldStage Newsonline– The Tertiary Education Trust Fund (TETfund) has justified the call for a further upward review of the education tax rate to three per cent, saying there is the need to boost education tax collection for the purposes of advancing tertiary education in Nigeria.
Mr Sonny Echono, Executive Secretary of TETfund said at the agency’s interactive forum with the Federal Inland Revenue Service (FIRS) on Tuesday in Lagos that this further underscores the recent successes recorded through intervention projects.
The theme of the forum is: Boosting Education Tax Collection for the Growth and Advancement of Tertiary Education in Nigeria.
According to him, these intervention projects and programmes are delivered by the Fund in Beneficiary Institutions (BIs).
Echono stated that this had warranted as well as justified the call for a further upward review of the education tax rate to three per cent.
He said that it was also in tandem with goals of different economies, as stated by some experts.
He quoted them as saying that: “this holds true, not just for Nigeria, but for most of Africa, where governments were already struggling to bring in adequate tax revenues before the pandemic”.
Echono argued that the need to boost ‘Education Tax (EDT) collection’, especially at this economically challenging period, could never be overemphasised.
This, according to him, is in view of the pivotal role it plays in the nation’s educational system, as deployed by the Fund.
He said that it was one of the many vital reasons why the interactive forum was critical in the general operations of the Fund.
“There is no doubt about the fact that tax collections have direct correlation to earnings and subsequently, the growth of any functional economic system.
“Invariably therefore, the growth of education tax which forms the bedrock of TETFund’s vision and mission in the nation’s education is one that is consistently on the front burner.
“It is therefore not a mere coincidence that the focus of our discourse in this year’s forum is centered on how to stimulate, improve and sustain the collection of education tax by all stakeholders.
“We duly recognise the immense contribution, of your mandate as the foremost and critical revenue service of the Federal Government, from which we as a funding agency of the same government derive our intervention and operational funds.
“We must therefore expand incidence, by bringing all eligible tax payers within the basket, while assiduously improving efficiency of collection,” he stated.
According to him, as the executive secretary and accounting officer of the fund (Education Tax) he is committed to its judicious in line with the act and mandate of the TETFund.
He said that he would also ensure transparency and accountability to government.
Echono said he would also ensure accountability and transparency to the citizens, as well as the agency’s stakeholders, of which the FIRS was one.
The TETfund boss stated that in the year 2021, the agency received an Education tax collection of N189 billion, which was N16 billion lower than the previous year’s collection.
He said that this posed a serious challenge to the intervention activities of the Fund for the year 2022.
“We had to scale down project implementation for the year in our beneficiary institutions and our internal operations as well.
“With the improved Education Tax collection for this 2022, I am delighted to note that the FIRS has given necessary impetus to our desire copiously expressed on the need to increase its drive on the education tax collection.
“As at September this year, the education tax collection was reported to have recorded over N309 billion, exceeding the N305 billion target set by the FIRS for the year.
“This explains my earlier excitement and hope of an improved revenue generation, ultimately attaining a N500 billion yearly education tax collection by 2025.
“Further to this, it is imperative to ensure that the education tax net expands to cover as much as is possible, so as to further improve the tertiary education sector,” he said.
Echono said that it was also important to consistently initiate and sustain proactive measures such as auditing, which is an integral part of making sure that everyone pays their fair share of taxes.
He said that recent trends and reports on tax gap had proven that low audit rate was a major impediment in revenue generation, especially in education tax collection.
Echono expressed optimism that the forum would afford them the opportunity to discuss the issues and many other options and possibilities in boosting education tax collection.
“I have no doubt that the FIRS is fully equipped with the knowledge and expertise and empowered with the force of law and the instruments of state to achieve this boost.
“Let me reiterate, and I believe that the FIRS will agree with me, on the need to constantly appreciate tax payers and the tremendous sacrifice they make to meet their corporate obligations.
“We assure them that the funds contributed will be prudently and judiciously deployed to rebuild the broken walls of the nation’s ivory towers,” he said.
On his part, Executive Chairman of the FIRS, Muhammad Nami, said the theme of this year’s forum synergises with the vision of the Service, which is to make taxation the pivot of national development.
Nami was represented by Mr Abubakar Sadiq Mohammed, Director/State Coordinator, Lagos Mainland East of the FIRS.
He lauded the board of trustees and management of TETfund for the steadfastness in organising the forum.
Nami said it served as an accountability platform to the various stakeholders.
According to him, there has never been a time such as now, where debate for accountability and transparency from government institutions, particularly in this electioneering season, has been demanded by citizens.
He, therefore, noted that it was imperative for institutions such as the FIRS and TETFUND to undertake activities such as the interactive sessions.
These, he said, sought to engage stakeholders and report to them on how taxpayers’ monies had been expended.
He stated that the tertiary education tax had improved significantly, since the beginning of 2022,adding that the Service had collected N309 billion as of September 2022.
“This is above the total N305 billion budgeted for the full year.
“I assure you that we will continue to ensure that no revenue gap is left uncovered, in our quest to improve tax administration with particular emphasis on full deployment of technology across our service lines and internal operations.
“The introduction of our Tax Administration Solution (Taxpromax) has enhanced compliance and collection of taxes from taxpayers.
“More importantly, we have been able to deploy technology to ease the burden of compliance to the taxpayers.
“We are doing more in this regard and recently launched our Service Charter, which encapsulate the rights of the taxpayer and the obligations of the tax administrator to the taxpayer,” he said.
He said that It was noteworthy that despite economic headwinds, FIRS had continued to make progress in revenue mobilisation for the three tiers of government.
“Suffice to say that the FIRS is now funding a significant portion of the Federal Account Allocation Committee (FAAC) in the last two years,” he stated.
According to him, between January and September 2022, the FIRS has collected N7.5 trillion, which is a significant improvement on the total collection of N6.4trillion for the entire 2021.
He said that with the development, it was clear that the reforms undertaken since 2020 had started yielding the desired results.