Key highlights
- President Buhari has approved the disbursement of N320 billion to tertiary institutions as the 2023 Education Fund
- TETFund says an increase in education tax paid by companies will ensure more money goes into higher institutions for educational development.
- The Fund says a total of 702 trillion has been disbursed as education tax collection to public universities, polytechnics, and colleges of education from 2015 to date.
The Tertiary Education Trust Fund (TETFund) has appealed to the Federal Government to increase the education tax from the current 2.5% to 3%.
The Executive Secretary of TETFund, Mr Sonny Echono, made the appeal while announcing the disbursement of N320 billion to public universities, polytechnics, and colleges of education as approved by President Muhammadu Buhari for 2023.
While commending the president for approving an increase in education tax from 2% to 2.5% in 2021, he said an increase to 3% will shore up the annual disbursements to tertiary institutions.
Speaking at the Annual Strategic Planning Workshop organised for Heads of Beneficiary Institutions in Abuja on Wednesday, Echono said that the fortunes of Nigerian tertiary education have improved significantly under the Buhari-led administration as it approved the increase.
He said TETFund received N257 billion in 2020 as collections but dropped to 189 billion in 2022, representing a 30% drop. He noted that the efforts of key actors in the sector had brought it up to N320 billion in 2023.
N1.702 trillion disbursed in 8 years
While noting that the current administration had disbursed more money into tertiary institutions in the last 8 years, Echono said:
- “Between 2015 to date, N1.702 trillion has been disbursed as education tax collection to public universities, polytechnics, and colleges of education compared to N1.249 trillion disbursed from the inception of the Fund in 1993 to 2014.
- “I am pleased to inform you that Mr President has approved the 2023 disbursement guidelines in the total sum of N320,345,040, 835.
- “On the basis of this, each university shall get, for the year 2023 intervention cycle, the total sum of N1,154,732,133.00. This comprises N954,732,123.00 as annual direct disbursement and N200 million as zonal intervention.
- “Similarly, each Polytechnic shall get N699,344,867.00 comprising of N569,344,807.00 as annual direct disbursement and N130 million as zonal intervention. Each College of Education shall get N800,862,602 comprising of N670,862,602.00 as annual direct disbursement and N130 million as zonal intervention.”
Highest disbursement to beneficiary institutions
The executive secretary further stated that the figure represented the highest disbursement to each beneficiary institution since the inception of the Fund. He expressed satisfaction over the remarkable success, attributing it to sustained efforts at increasing the efficiency of the collection of the education tax. Echono said that this was achievable through the efforts of the Minister of Education, Mallam Adamu Adamu, and the Minister of Finance, Mrs Zainab Ahmed.
- “Distinguished heads of institutions, the year 2023 just like the previous year remains a promising year that has seen tremendous improvement in the collection of education taxes. As we distribute the year 2023 allocation letters today, I am pleased to inform you that we have kept our promise to constantly improve our operations and reduce processing,” he said.
The tertiary education tax is imposed on every Nigerian company at the rate of 2.5% of the assessable profit for each year of assessment. The tax is payable within two months of an assessment notice from the FIRS.