The Vice-Chancellor, Obafemi Awolowo University, Prof Eyitope Ogunnbodede, has assured the university community that the issue of tax debt will be resolved with the state government without delay.
Ogunnbodede said this in a statement he signed on Friday in Ile-Ife, Osun, adding that the vexed issue would not be allowed to damage the harmonious relationship between the university and the Government of Osun State.
“Members of the university and other stakeholders no doubt are embarrassed by the event of Wednesday, 2nd May, 2018, when the Osun State Government sealed off the main Gate of the University and the University Secretariat due to an alleged tax default by the University.
” It has become necessary to react to the claims of the state government and misinformation/total falsehoods making the rounds in the community in the aftermath of that unfortunate incident.
“In particular, the university authorities note the claim that the university was owing N1.84 billion of tax and has refused to negotiate with the government as false, malicious and total misrepresentation of the truth on this matter.”
The vice-chancellor debunked the claims made by the state Internal Revenue Service (IRS).
He said that the past tax liability, which represented the sum the IRS claimed that the university under-deducted from staff salaries for the period 2015 and 2016 for Pay As You Earn (PAYE), had been a subject of negotiations between the university and the IRS.
He further said that the university administration “vehemently” disputed the figure of N1.844 billion submitted by the IRS and insisted that if there had been under-deduction at all, only the sum of N287 million was the amount by which PAYE was under-deducted from staff salaries.
He said that the matter had been referred to the Presidential Initiative on Continuous Audit (PICA) in the Office of the Accountant-General of the Federation, following a letter personally signed by the Governor to the President of the Federation.
“Both the Osun State Government tax authorities and the university officers had attended the PICA session where the matter was resolved.”
According to him, the Accountant General of the Federation, after examining the claim of the Osun IRS and that of the university, by a letter reference number INV/0089/844/II dated Jan. 19, 2018, concluded that university’s outstanding tax liabilities was N384 million only, being the under-deducted PAYE from staff salaries.
“Parties agreed to this conclusion, and the recommendation that this sum could be paid in monthly instalment of N5 million.
“It is, therefore, with total shock that the university community woke up on Wednesday, 2nd May, 2018 to find the university main gate as well the university secretariat sealed up by the Osun State Government.”
Ogunbodede urged members of the public to note that the past tax liabilities of 2015 and 2016 in dispute was never deducted from staff salaries as being erroneously claimed.
He further explained that the university had never failed at any point in time to remit PAYE deducted from staff salaries to the tax authorities.
He added that it was a case of under-deduction and not of non-remittance of tax.
According to him, the anomaly has since been corrected and the university employees have been paying correct tax rates since January 2017.