Confusion over tax payment by students in Osun

The state of Osun is in the news for the wrong reason as the imposition of tax on students by the state government is presently causing furore in many schools. LATEEF DADA writes.

The fall in the price of oil resulting in the reduction of monthly allocation accruable to Osun state had led to the introduction of tax by the immediate past governor of Osun state, Mr Rauf Aregbesola, in order to meet the demands of the people of the state, and particularly to pay workers salary.

The development appeared strange thereby leading to series of protests in some quarters.

The introduction of tax to public schools, in particular, generated reaction as some public secondary schools’ students protested against the demands of three years tax clearance from their parents by the state government.

The state government had directed adult artisan to pay the sum of N1,500 per year as tax, while the arrears of three years tax beginning from 2013 to 2015 amounted to N4,500 to be paid altogether. The state government also demanded evidence of tax payment from students resuming in new schools in the state while the tax payment was laid as precondition for the students to write examination then.

However, students in all stages have concurred and have been used to the payment annually until recently when the state government through the Osun Internal Revenue Service issued a letter to heads of state-owned tertiary institutions, informing them that the tax has been jacked up to N3,500 and each students is expected to pay a total sum of N10,500.

Although, Governor Gboyega Oyetola has on many occasions confessed that the accrued revenue from the centre would not be enough to run the state without payment of tax, but the recent increase was considered too much.

Recently, the sum of N2.01bn was deducted by the federal government from the last allocation accruing to the state to service external debt and other contractual obligations. These and many reasons occasioned the increment of tax to boost the state internally generated revenue.

Oyetola at a function said, “Major programmes of the government like the feeding of pupils, security of lives and property and provision of amenities cannot be carried out unless there are resources. He said, “We cannot continue to rely on revenue from the Federation Account.”

According to the governor, part of his administration’s plans is to raise the IGR of the state without adding to the burden of the people.

Speaking at another function recently, Oyetola said, “I wish to remind all of you that payment of taxes is your civic responsibility. The revenue that accrues to the state from the federation account is not enough for the implementation of our programmes and projects for the well-being of the people and the development of the state without supporting it with IGR.

“I am, therefore, imploring all taxable adults and business entities in our state to ensure that they carry out their civic responsibilities by paying the appropriate taxes promptly.

Government increased tax

However, in what seems to be compliance with the directive of the state government, the state internal revenue services on November 7th, 2019, issued a letter to the state-owned tertiary institutions, informing them of the tax increment. A copy of the letter sent to Osun State University obtained by Blueprint was titled: ‘Compliance and Enforcement of Taxes in the State of Osun’.

“With reference to our circular letter of January 2018 on the urgent need for parents and guardians to pay their taxes, I wish to inform all management of higher institutions in the state of Osun to be fully involved in the exercise. For clarity sake, the tax payment is now three thousand naira and CPDL is 500 totalling N3,500 per year; therefore, for three years, each student is expected to pay a total sum of N10,500.

“To this end, the provost is hereby advised to request parents and guardians to pay taxes appropriately. It should be emphasized that upon payment, photocopies of E-receipt should be attached to the tax clearance certificate for presentation.”

Apparently, acting on the letter received from the IRS, the management of Osun state College of Technology (OSCOTECH) Esa-Oke issued circular directing students to pay the new tax.

A memo signed on behalf of the Bursar of OSCOTECH by one Mr Ayodele L. M dated November 19, 2019 and titled: ‘Review of Tax Clearance Fee’, informed the students of the directives from the state government on the new tax and directed the students to begin the payment.

The letter reads, “This is to inform the general populace that the state of Osun has reviewed the amount payable as taxes per annum from N1,500 per annum to N3,500 per annum; therefore, for the three years, each students is expected to pay a total of N10,500. Each student must collect the E-payment receipt and tax certificate as evidence of payment.”

Upon sighting the memo, some students reportedly mobilised and planned to protest the new tax before it got to the notice of the government. The state government immediately took a step to prevent the protest by denying the knowledge of the letter and subsequently announced the suspension of the bursar.

Government’s denial

A letter issued on November 26, 2019 and jointly signed by the commissioner for education and special adviser to Governor Oyetola on education reads, “It has come to the notice of the Ministry of Education that an unauthorised circular has been expressing increment in tax payable by students of the state-owned tertiary institutions.

“May it be known therefore by the public in general and students in particular that government of the state of Osun dissociates herself from such circular as governments would never tax students.

“Where such circular has been released to the students or the academic community, the Bursar has been put on suspension for the unilateral decision until further notice.

“In the instance case, the bursar of the state College of Technology, Esa-Oke is culpable and has been directed to process on suspension.

“The authority of the Ministry of Education on behalf of the state government therefore appeals for calm among the students as the appropriate department of government saddled with the responsibility of tax on taxable adults and not students will make the appropriate pronouncement on the matter soon.

However, the denial of the letter issued by the state internal revenue has raised suspicion because the letter was sent to all the state-owned tertiary institutions and the internal revenue has not denied the letter directing each student to pay the new tax.

Osun IRS recants

The chairman of Osun IRS, Mr Gbite Ademikanra, in a chat with Blueprint, said the institutions were only reminded on the tax that is being paid in their institutions so that they could remind their students. He said the IRS has not issued any letter to the effect of increasing the tax in higher institutions in the state.

It was, however, gathered that management of the OSCOTECH has been directed to calm the situation by whatever means as the fees has not been reviewed.

The rector of OSCOTECH, Dr S. A. O. Adegoke, in a memo issued on November 27 and titled: ‘Re-Compliance and Enforcement of Taxes in the State of Osun – Clarification’, explained that the tax is to be paid by parents and not students as earlier stated in the earlier memo.

The letter reads, “Please refer to the Osun Internal Revenue Service’s letter dated 7th November, 2019 and the college internal memorandum of 19 November 2019 in respect or the above. This is to correct the misinformation in the said memo and to emphasise that parents and guidance are to pay the said tax, and that students are only required to bring evidence of their parents or guidance Tax Clearance Certificate or photocopy of E-receipt.

“For clarity purpose, we want to emphasise that students have never been expected to pay tax, rather, it is their parents and guardians.

“Therefore, we regret any embarrassment this must have caused the government of the state of Osun.

Meanwhile, it was gathered that some students have been paying the tax. Some students who spoke to Blueprint in Osun state University said every students must pay the tax during registration in school.

It was gathered that offices of the IRS have been sited in all the tertiary institutions in the state. One the students in Osun state Polytechnic, Iree who spoke on anonymity said, “You will just go to the office of the tax collector who are the agent of IRS and pay the money.”

According to the students, it is only the new students that would pay N10,500 while the other students will pay N3,500 for the present year.

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