Professor Bode Ayorinde, the Pro-Chancellor of Achievers University, Owo, has strongly appealed to the Federal Government to grant full tax exemption to all educational institutions, particularly universities, arguing that the existing tax burden is severely stifling the growth of the critical sector.
Speaking at the institution’s 15th convocation and 18th founder’s day ceremonies, Prof. Ayorinde emphasized that education should be treated as a strategic investment in human capital and not merely as a commercial enterprise or revenue-generating activity.
Ayorinde’s address, titled “Rethinking Taxation in the Education Sector: Why Educational Institutions Should Not Be Taxed,” laid out clear economic and policy reasons for the urgent tax holiday.
He stressed that treating social investments like establishing a university as a commercial venture, subject to multiple taxes, actively discourages potential investors interested in complementing the government’s efforts to close the admission gap.
The Pro-Chancellor highlighted that the multitude of taxes, including Company Income Tax (CIT), Value Added Tax (VAT), Education Tax, development levies, and various local government charges, eat deeply into tuition fees. He estimated that these taxes consume over 40 per cent of the fees classified as revenue.
He argued that taxing knowledge forces institutions to make difficult choices, potentially leading them to withdraw scholarships, discontinue free-tuition programs, or significantly increase fees, thereby denying access to qualified, but financially disadvantaged, students.
Ayorinde maintained that taxing educational institutions contradicts National Development Goals and undermines research, innovation, and knowledge production, noting that no nation can industrialize without heavily investing in education.
“Putting a tax burden on universities is a national misstep… I stand here to argue strongly that education should never be taxed. Instead, it should be supported, subsidised and incentivised as a critical sector for national transformation.” — Prof. Bode Ayorinde
Ayorinde’s call comes against the backdrop of the Finance Act 2021, which significantly amended the Companies Income Tax Act (CITA).
Previously, the profits of a company engaged in “ecclesiastical, charitable or educational activities of a public character” were generally exempted from CIT.
The Finance Act 2021 deleted the word “educational” from the exemption list under Section 23(1)(c) of CITA.
This amendment made profits from educational activities liable to Companies Income Tax (CIT), irrespective of the company’s incorporation status (unless the institution meets the strict criteria of a “small company” with turnover below ₦25 million).
Prof. Ayorinde specifically appealed to the Federal Government to direct the Federal Inland Revenue Service (FIRS) and state boards of internal revenue to implement the full tax exemption immediately.
