18 May 2018

Nigeria: Osun Govt Versus OAU - Untold Story of Tax Brouhaha

Osogbo — What would have been a perfect denouement in the face-off between the Osun State Government and the authorities of Obafemi Awolowo University, OAU, Ile Ife, over unremitted taxes by the institution, has set a stage for a fresh round of controversies.

Recall that the institution's campus was sealed by officials of the Osun Internal Revenue Service, OIRS, because OAU's management failed to remit tax deductions running to over N1. billion from staff salaries.

At the time the institution was sealed, OAU campus that was just returning to life, following resumption for a new academic session of freshmen, was immediately thrown into a panic, as its entrance, and later the Senate Building was sealed by officials of the state.

Few days before the institution was to come under the hammer, the Special Adviser on Tax Matters to Osun State governor, Mr. Gbenga Akano, said the government had decided to prosecute in seven days, if organisations owing it unpaid taxes, failed to regularise their taxes.

Before dragging the defaulters to court, Akano said several notices had been issued and meetings held to ensure that the matter does not result to litigation.

His words: "Several meetings have been held with affected organisations, but it has been a continuous imperviousness and indebtedness. We are left with no option than to openly mention some tax defaulters who failed to perform their civic responsibilities.

"We are serious about getting every kobo owed Osun state. The government is doing its best to meet the yawnings of the people. We need money to do more. We are not asking for extra. But what is legitimately due to us in taxes must be given to us."

A week after the ultimatum, OIRS officials stormed the entrance of the university, sealed the institution, and prevented workers from accessing the Senate Building of the institution.

VC denies tax default

The OAU Vice-Chancellor, Prof. Eyitope Ogunbodede, when contacted, on the day the institution was sealed, disclosed that the university had not defaulted in tax remittance, adding that the issue had to do with the backlog of 2015 and 2016, which the university had already negotiated with the state on how to settle.

Ogunbodede said: "It is true they sealed the place. The truth is that there was a backlog of 2015 and 2016 and we have agreed to pay N5m monthly. We paid N500million."

But despite the assurance, the institution was under lock for about seven days, until the OIRS unsealed it and normal activities returned to the campus.

This was after the institution had paid a sum of N25million in its outstanding tax liabilities to the government.

While for now, Osun government and OAU are both staying in their corners in the ring, the tango between the two over the matter is far from being over.

This is because the parties have not arrived at a uniform figure as tax liabilities owed by the institution.

Allegations and counter allegations

OAU management, in its reaction when the campus was sealed, claimed, it owed a sum of N287 million in unremitted taxes of workers.

Deflating this claim, Osun state government, through the office of Special Adviser, Tax Matters, Mr. Akano, dismissed OAU's claim.

Prior to the unsealing of the institution, Akano disclosed that several influential Nigerians, including Mr. Femi Falana, SAN, intervened in the matter.

He also insisted the institution owed N1.8 billion outstanding unremitted withholding taxes.

Akano said: "Once again we are here to set the record straight and maintain our earlier position on tax issues involving Obafemi Awolowo University.

"The figure of N384m as being claimed by the authority of OAU as their outstanding tax liability for 2015 and 2016 is misleading. As of 4th May 2018. the amount of N287,815,947.07 has been their outstanding in respect of 2006-2014 contrary to OAU rejoinder of N384,000,000.00.

"The sum of 1.8bn claimed by the Osun state government s a painstaking audit of the books supplied by the institution themselves to our crack team of auditors, meanwhile relevant tax laws allows anybody or any institution to raise objections or appeal against an audit report within a limited time frame which the university failed to do so."

With the different positions held by the two parties, for how long will the imbroglio continue? Time will tell.


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