Banks under fire as House of Reps seeks answers on non-remittance of education taxes

Business a.m.

The House of Representatives Committee on Tertiary Education Trust Fund (TETFund) has called upon commercial banks and their tax consultants to appear before the committee to reconcile the education tax computation not remitted from 2011 to 2022. 

The decisive move came after Miriam Onuoha,the chairman of the committee, issued an invitation, summoning the banks that appeared before the panel to account for their non-remittance of education taxes between 2011 to 2022. The committee, thereafter scrutinised the collection, utilisation, and other associated services related to education tax over the 11-year period.

Onuoha raised concerns concerning the banks’ financial statements which showed discrepancies between the amounts that were supposed to be remitted by banks as education tax and the actual amounts that were remitted to the Federal Inland Revenue Service (FIRS). 

According to the committee, only three of the 15 banks that were invited to appear  actually showed up, while the remaining three sought a new date for their appearance.

The committee thereafter summoned the banks to appear on the 20th June to present the required financial statements and  documents before the House. The banks summoned 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.

Bappa Aliyu Misau, the deputy chairman of the committee, pointed out that First Bank, one of the largest financial institutions in the country, had violated the law by under-remitting the education tax it collected from its customers to TETFund. He noted further that the bank’s actions were punishable and carried serious legal consequences.

Misau stated: “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.”

Bashir Yusuf, executive director of First Bank, defended the bank’s financial records during the hearing. Yusuf revealed that the bank posted a PBT of N795.123 billion between 2011 and 2022.

In his remarks, Victor Osodeke, president of the Academic Staff Union of Universities (ASUU),  called on the federal government to immediately stop providing waivers for the funding of tertiary institutions in Nigeria. Osodeke linked the underfunding of tertiary institutions and the frequent strikes by university lecturers to the waivers granted to banks and private institutions.

Meanwhile, representatives of the Academic Staff Union of Universities strongly criticised banks for providing different figures in their submissions to the House of Representatives Committee on Tertiary Education Trust Fund. ASUU also requested that the FIRS be held accountable for their duty to collect taxes efficiently and transparently, and urged them to put an end to any perceived games with the banks.