The House of Representatives Committee on Tertiary Education Trust Fund (TETFund) has directed First Bank of Nigeria and other Banks to appear before it alongside its Tax Consultant to reconcile the Education Tax Computation not remitted to TETFund by the banks between 2011 and 2022.
The lawmakers said there were disparities between the figures that was in the bank’s financial statements as Provisions for that purpose and what the Bank actually remitted to Federal Inland Revenue Service (FIRS).
Chairman of the Committee, Hon. Miriam Odinaka Onuoha gave the directive when some banks appeared before the committee to defend their non remittance of Education Taxes over the years on Tuesday.
This is as the President Academic Staff Union of Universities (ASUU), Professor Victor Osodeke, has urged the federal government to as a matter of urgency stop tax waivers meant to fund tertiary institutions in the country.
Osodeke who was speaking during the ublic hearing on Monitoring of Collection, utilization and other associated services relating to Education Tax from 2011 – 2022, hinged the poor funding of tertiary institutions and incessant industrial actions to waivers granted to banks and other private institutions.
Upon their admittances of such discrepancies, without any substantial explanation, the panel summoned the Banks to come along with details of their Tax computations ,their External Auditors and Tax Consultant along with proofs of remittances by 20th June, 2024.
‘The Banks disregarded their own Financial Statement liabilities on Education Tax and made under remittances’.
This followed a motion by Hon. Oluwole Oke (PDP, Osun) asking the banks to appear before the committee with the tax consultants with details of that tax computation on a yearly basis.
Miriam said out of the 15 banks invited, about seven were supposed to appear before the committee on Tuesday, while only three of them showed up with three other writing to seek a new date to appear.
Full list of Banks summoned to appear on the 20th June with the aforementioned documents and persons include, Zenith Bank, Access Bank, First Bank, United Bank for Africa (UBA), Sterling Bank, Keystone Bank, FBN Quest Merchant Bank, First Bank, Guarantee Trust Bank, Stanbic Bank, Wema Bank, Eco Bank, Fidelity Bank, Jaiz Bank and Unity Bank.
Deputy Chairman of the committee Hon Bappa Aliyu Misau (PDP, Bauchi had observed that First Bank under remitted its education tax deductions to TETFund, an action which he said was punishable under the law.
Misau said “unfortunately, you do not have the year-by-year breakdown but the available records you submitted in 2011 was N603,801. Then, in 2012, you are owing N301,263,135, in 2013, you have a credit balance of N102,713,615.
“Again, in 2014, you had a credit of N2.933, 659, then if you go to 2015, you have N25 million as outstanding, in 2017, N169, 852,600 outstanding, in 2018 you have N98 million outstanding, in 2012, you paid N7.877,451 then in 2020 N148 million credit, in 2021, N269,618,626.6 debit.
Therefore, in 2022, you had N3.748,984, 654.64. Then you add it up, you sum the credit and the debit, you ended up with N3.749,353,260 outstanding. You know there is penalty for Non-Remittance”.
An Executive Director with First Bank, Bashir Yusuf who represented the bank at the meeting told the lawmakers that between 2011 and 2022, the Bank posted a Profit Before Tax (PBT) of N795,123 billion.
When asked to take the figure year by year, the FBN executive director said, it was a summary of the presentation, saying “unfortunately Madam Chair what I have is the summary of the presentation.
I crave the indulgence of the committee to take what we shared with the Committee. I prepared the summary for the presentation, so that if there are issues, we can take those issues, especially if there are matters that we need to settle outside the Committee room, our consultants.
“So, I am very sorry, I don’t have the breakdown by year, but I have the summary over the period. We had the net accessible profits of N28 billion, which is the difference between the allowable and the disallowable expenses on the PBT we posted over the period.
“In terms of tax liability over the period, we have a tax liability of N5.498 billion. Then, over the periods of the audit by the Committee, that is 2011 to 2022, we had additional assessments. It was on the basis of those assessments conducted between 2014 and 2021 that we had an additional liability of N852 million.
“So, in terms of total TETFUND Tertiary Education Tax Fund liability and payment, we made a payment of N5.493 billion.
And in terms of outstanding liability over the period, we have Nil liability over the period and other subsequent items associated with outstanding liability are also ready”.
He said further that there were issues that cannot be resolved at the committee hearing, adding that “what you have are items that are classified as taxable.
We have some differences based on the provision of exemption order that was issued by the President in 2011. That’s why I said some of these issues we will not be able to resolve at this sitting.
When the Committee asked the Bank to provide the Exemption Order on Education Tax as it relates to the matter under review, he could not provide any , Furthermore , the Bank already made provisions in their Financial Statements for same Education Taxes without remittances in those respective years.
ASUU representatives berated the Banks for providing different figures to the Committee after making submissions earlier in January 2024 under Oath.
The union further requested the FIRS to stand-up to their duties on the efficient and honest tax collection and stop the games playing with the Banks.
