Reps Summon First Bank and 13 other commercial banks others over Non-Remittance of Education Taxes worth billions of naira of between 2011-2022 in violation of the TETFUND Act.
14 commercial banks have been summoned by the House of Representatives Committee on Tertiary Education Trust Fund (TETFund) to appear before it alongside its tax consultants to reconcile the Education Tax Computation not remitted to TETFund by the banks between 2011 and 2022.
Chairman of the Committee, Rep. Miriam Odinaka Onuoha (APC, Imo) issued the directive on Tuesday when some banks appeared before the House Committee to defend their non-remittance of Education Taxes for the past 11 years as there were disparities between the figures in the bank’s financial statements as provisions for the taxes and what the bank remitted to Federal Inland Revenue Services (FIRS).
The banks had admitted to the discrepancies, without putting up any defence, hence the summons by the Committee urging them to come with details of their tax computations, their External Auditors and Tax Consultants along with proof of remittances by 20th June 2024.
The full list of Banks summoned to appear before the Committee includes: Zenith Bank; Access Bank; First Bank of Nigeria; United Bank for Africa (UBA); Sterling Bank; Keystone Bank; FBN Quest Merchant Bank; Guarantee Trust Bank (GTB); Stanbic IBTC; Wema Bank; EcoBank; Fidelity Bank; Jaiz Bank; and, Unity Bank.
Rep Onuoha revealed out of the 14 banks invited, seven were supposed to appear before the Committee on Tuesday, while only three of them showed up as the others pleaded for a new date to appear.
Deputy Chairman of the Committee Rep. Bappa Aliyu Misau (PDP, Bauchi) had observed that First Bank under-remitted its education tax deductions to TETFund, an action which he said was punishable under the law.
Misau said “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 owe 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, and you end up with N3.749,353,260 outstanding. You know there is a penalty for Non-Remittance”.
In his response, Bashir Yusuf, who represented the bank at the meeting, told the lawmakers that between 2011 and 2022, the Bank posted a Profit Before Tax (PBT) of N795,123 billion.
When asked to take the figure year by year, the FBN representative said, it was a summary of the presentation, saying “Unfortunately Madam Chair, what I have is the summary of the presentation.
“I crave the indulgence of the Committee to take what we shared with the Committee. I prepared the summary for the presentation, so that if there are issues, we can take those issues, especially if there are matters that we need to settle outside the Committee room, our consultants.
“So, I am very sorry, I don’t have the breakdown by year, but I have the summary over the period. We had net accessible profits of N28 billion, which is the difference between the allowable and the disallowable expenses on the PBT we posted over the period.
“In terms of tax liability over the period, we have a tax liability of N5.498 billion. Then, over the periods of the audit by the Committee, that is 2011 to 2022, we had additional assessments. It was based on those assessments conducted between 2014 and 2021 that we had an additional liability of N852 million.
“So, in terms of total TETFUND Tertiary Education Tax Fund liability and payment, we made a payment of N5.493 billion.
“And in terms of outstanding liability over the period, we have Nil liability over the period and other subsequent items associated with outstanding liability are also ready.
“We have some differences based on the provision of the exemption order that was issued by the President in 2011. That’s why I said some of these issues we will not be able to resolve at this sitting.”
When the Committee asked the bank to provide the Exemption Order on Education Tax as it relates to the matter under review, he could not provide any but it was observed that the Bank already made provisions in their Financial Statements for same Education Taxes without remittances in those respective years.
