The Ministry of Education says Nigeria’s proposed tax reform bills are undergoing revisions to maintain the Tertiary Education Trust Fund (TETFund) after 2030.
On Thursday, the federal government’s proposed reform for the education sector was presented to the media in Abuja by Tunji Alausa, the minister of education.
President Bola Tinubu requested that four tax reform bills be considered and passed by the National Assembly in October.
Nigeria Tax Bill, Nigeria Tax Administration Bill, Nigeria Revenue Service Establishment Bill, and Joint Revenue Board Establishment Bill are among the legislation.
A part of the tax administration bill proposes eliminating the education tax, to be replaced by a “development levy”.
This will essentially interrupt the funding stream of TETFund, an entity that has considerably sponsored infrastructural development in Nigeria’s public tertiary institutions during the previous decade.
The tax bill’s proposed development charge will be collected in stages, with taxable firms paying 4% of the total for 2025–2026 and 3% for 2027–2028–2029.
Due to the proposed bill, the TETFund would receive around 50% of the levy’s proceeds in 2025 and 2026.
The share of the TETFund would increase to 66% in 2027, 2028, and 2029.
After 2030, the agency would no longer get any funding.
The development levy would drop to 2% in 2030 and be used exclusively to finance the federal government’s student loan program.
Stakeholders sharply condemned this initiative, arguing that it was an attempt to commodify education and undermine the TETFund.
Alausa addressed the earlier ambiguity over the TETFund’s future if the tax bills sail at the cabinet briefing.
He stated that in order to maintain the TETFund’s funding stream, the education ministry is collaborating with the National Assembly’s tax reform committee.
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“You must have heard some information about the new tax law about the phasing out of TETFund by 2030, as well as NASENI and NITDA. We’ve worked with the tax reform committee at the national assembly,” the minister said.
“We can report to you now that this is not going to be the case. TETFund will continue into eternity. The legislators and the executive are working on various amendments to the tax law.
“By the time the final document is passed, the education tax monies to TETFund will be protected, even to NITDA and NASENI. I can assure you that the percentage of the new development tax levy has been increased.”
Established in 2011, TETFund monitors the disbursement of education tax to public tertiary institutions in Nigeria.
This education fund was, for over a decade, driven by a two and later three per cent deduction from the assessable profit of registered companies.
It is collected by the Federal Inland Revenue Service (FIRS) and annually remitted to TETFund for infrastructure, research, and training in public tertiary institutions.
