ActionAid urges federal government to increase tax revenue to fund education

ActionAid urges federal government to increase tax revenue to fund education
ActionAid Nigeria

The Country Director, Actionaid Nigeria, Mrs Ene Obi has urged federal and state governments to take decisive steps to increase the funds allocated to the education sector in order to improve the quality of education.

Obi said this in an interview with the News Agency of Nigeria (NAN) on Monday in Lagos on the sidelines of a workshop on Breaking Barriers for Girl’s Education.

She tasked the governments to break the barriers to quality public education by improving tax revenue, particularly corporate tax, as a way of providing sustainable funding to the sector.

She listed some of the barriers to public primary education as poor school infrastructure, violence and discrimination, failure to recruit and retain good quality teachers among others.

“If states commit to finding resources to increase the size of their education budget for globally agreed targets, all children including the poorest and most marginalised will enjoy free, quality public education,” Obi said.

Obi revealed that Actionaid had received 6.2 million dollars grant from the Norwegian Agency for Development Cooperation (NORAD) to influence policy making and initiatives to increase the size and share of education budget.

In addition, she said the project aimed at ensuring the public education system became more responsive to the needs of girls and marginalised children.

NAN reports that about 10.5 million children are out of school in Nigeria, with the country investing only about seven per cent of its budget on education, short of the UNESCO 20 per cent benchmark.

Experts observe that there is a link between the crumbling education service and evasion of tax by local and multinational companies in Nigeria.

They note that money accruing from a proper tax regime can be useful in addressing infrastructure deficit in Nigeria’s education sector.

Statistics obtained from the Federal Inland Revenue Service (FIRS) show that out of the 450,000 limited liability companies operating in Nigeria, no fewer than 125,000 representing 27.7 per cent pay any form of taxes.

Dr Charles Nwaobia, an education stakeholder, observed that the Education Tax Act indicated that government intended to have a sustainable education system funded through tax.

He said the tax imposed by the act was meant to fund the federal, states and local government educational institutions, including primary and secondary schools.

“Two per cent shall be charged on the assessable profit of a company registered in Nigeria.

“The Federal Board of Inland Revenue shall assess and collect from a company the tax imposed by this act.

“Accordingly, the higher education shall receive 50 per cent, primary education 30 per cent; and secondary education shall receive 20 per cent of the total tax collected in any one year,” Nwaobia said, citing a portion of the act.

Nwaobia said the number of companies that were taxed would determine the amount of money put into the education system.

Comment here