. LND: Tying derivation to consumption areas ‘ll perpetuate inequalities
Chuks Okocha in Abuja and Kemi Olaitan in Ibadan
The Academic Staff Union of Universities (ASUU), yesterday, called on President Bola Tinubu, not to sacrifice the country’s educational system in blind obedience to the International Monetary Fund (IMF) directed policies.
The Ibadan Zonal Coordinator of the union, Prof. Oyegoke Oyebamiji, made the call yesterday at a press conference to draw the attention of the federal government and national assembly to what it described as the inherent dangers in the proposed abolition of TETFund and its replacement with NELFUND in the proposed Public Benefit and Taxation Bill (PBTB) of 2024.
The Ibadan Zone of ASUU comprises the University of Ibadan; University of Ilorin; Ladoke Akintola University of Technology (LAUTECH), Ogbomoso; Osun State University, Osogbo; Kwara State University, Malete; and Emmanuel Alayande University of Education, Oyo State.
Oyebamiji noted that TETFund, which is the brainchild of the union, has greatly helped in improving infrastructural development in Nigerian tertiary institutions, aided capacity building of members of academic staff, contributed immensely to promotion of cutting-edge researches, assisted in organizing seminars, workshops and learned conferences both locally and internationally.
He added that it helped in equipping scanty scientific and engineering laboratories, purchasing books to stock obsolete libraries and is useful in providing state-of-art e-libraries in tertiary institutions.
He warned that replacing TETFund with NELFUND is tantamount to cutting one’s nose to spite one’s face, stating it is retrogressive and inimical to the desirable future of the Nigerian public education system.
The ASUU boss insisted that taking any percentage out of the Education Tax (Development Levy) to service other agencies not known to the TETFund Act 2011 is not only illegal but should not be allowed to stand especially when no visible priority has been given to funding public education through budgetary allocation by successive Federal and state governments.
“ASUU notes with serious concern, Section 59(3) of the Nigeria Tax Bill (NTB) 2024 which specifically states that only 50 per cent of the Development Levy would be made available to TETFund in 2025 and 2026, while NITDA, NASENI, and NELFUND would share the remaining percentages”, he said.
Oyebamiji maintained that a government that allocates seven per cent of budget to education, as against the 15 per cent in its manifesto during campaign and over 20 per cent recommended by UNESCO should be resisted from commercialising public education its top officials had benefited so much from to be who and where they are in Nigeria and the rest of the world.
According to him, “TETFund will also receive “66⅔ per cent in 2027, 2028 and 2029 years of assessment” but “0% in 2030 year of assessment and thereafter.”
“Giving zero allocation of Development Levy to TETFund as from 2030 is a technical way of abrogating the agency and public tertiary education in the country.
“The purported admonishment that TETFund should seek innovative ways of generating its funds is a confirmation of the words of a one-time Vice-Chancellor of the premier university of Nigeria, who observed, ‘all things bright and beautiful, Nigerians destroy them all’.
“If Tetfund as a creation of an Act is technically killed through the proposed Tax Reform, then how can a dead agency devise an innovative means of generating its funds?”
He disclosed that the Ibadan zone of the union is seriously concerned that while Ghana has just established Ghana Education Trust Fund (GETFund) borrowed from the Nigerian experience as well as other African countries recently visited, the government in Nigeria is unfortunately planning to kill an agency that has kept all the public universities alive for more than three decades.
Oyebamiji listed the dangers of abolishing TETFund to include loss of critical funding, disruption of ongoing projects and programmes, negative impact on research and development, increased burden on students and parents, undermining of university autonomy, problem of loan recovery from defaulters, looming and ominous loss of jobs for employees in TETFund.
While opposing any plans to destroy TETFund and its replacement with NELFUND, he urged the national assembly and the federal government to reconsider this proposal and instead, work to strengthen TETFund and ensure its continued relevance in supporting tertiary education in the country
Meanwhile, tthe League of Northern Democrats (LND) has said that limiting derivation to areas of consumption under the proposed tax reform laws will perpetuate regional inequality in Nigeria.
Though, the northern group commended the governors for the endorsement of the tax reform bills, it wants a proper definition of the derivative to avoid perpetuating regional inequalities.
The Director of Publicity of the league, Dr, Ladam Salihu, in a statement yesterday, said that by the proposed increase of derivation to 30 per cent risks perpetuating regional inequalities in Nigeria.
He said that the governors’ endorsement of a revised Value Added Tax on Tax and Fiscal Reforms will benefit disproportionately at the expense of others, particularly the North.
According to the northern pressure group, ‘’The modernise Nigeria’s fiscal system, enhance stability and align with global best practices. However, there is one critical issue overlooked in the Governors Forum’s communique .’’
He said that the group welcomes the governors’ recognition of the need for comprehensive tax reforms to ensure that resources are distributed based on actual economic activity and contribution.
But added that cornerstone of LND’s recommendations and remains non-negotiable, stressing ‘’Without this definition,
that requires urgent resolution before LND can fully endorse the reforms: the definition of meeting with the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, must be addressed
According to the group, ‘’For any tax reform to achieve equity, fairness and sustainability, “derivation” must be at the conclusion of
population aligns substantially with the recommendations of LND’s Technical Committee ‘’
The northern group raised critical concern over “Derivation” to seek and to achieve in the first place absence of clarity on this matter which undermines the principles of equity that the reforms is based.
The league said that it acknowledges and supports the recent clearly and unambiguously defined to mean the place of consumption.
According to it ‘’This was a (VAT) sharing formula of 50 per cent based on equality, 30 per cent based on derivation and 20 per cent based not only aligns with the realities of modern taxation but also promotes accountability and incentivizes regions to develop their economic capacities.
Accordingly, it said: ‘’Until this critical issue is resolved, LND will withhold its full support for the tax reform, these reforms succeed in fostering fairness, growth and prosperity for our people and beneficial outcomes for all Nigerians.
‘’As stakeholders in the Nigerian project committed to our regional and national
agenda. We urge the NGF and the Presidential Tax Reform Committee to incorporate this fundamental clarification, and all other amendments made by the LND, including the development.
LND reiterated its readiness to work collaboratively with all parties to ensure that
inheritance tax clause is included into their framework to guarantee that the reforms deliver equitable
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