Lagos private schools on collision course with tax, revenue agencies

AS the harsh effects of COVID-19 pandemic and the current economy recession bit harder on businesses in the country, private schools in Lagos State are finding it difficult to meet many of their financial obligations to stakeholders, including tax payment to government.

Nigerian Tribune gathered that officials from the state Internal Revenue Service (LIRS) and those of local government councils had been going around schools for collection of taxes and levies from them with such action always ending in shouting match.

According to Nigerian Tribune investigations, school owners in the state are not favourably disposed to this development, especially because of the long closure of schools occasioned by coronavirus pandemic.

They argued that government and its agencies had no moral ground to approach them for tax or any other levies as they had just reopened for activities after about seven months without generating income, but LIRS on its part, according to sources, insisted on generating revenues for government that is also in need of money to fix the economy.

The proprietors also kicked against the plan by the Lagos State Waste Management Authority (LAWMA) which they claimed authorised  waste collectors to replace the charges of the social service rates with commercial rates as applicable to business owners.

They expressed concerns that government and its agencies were demanding too much from them even when they were not generating so much income like business ventures.

They listed some of the taxes and levies imposed on them by governments and its agencies to include annual dues, income tax, staff social development levy, radio and television levy, as well as fumigation levy, among others.

Chairman of League of Muslim School Proprietors (LEAMSP), Lagos State chapter, Mr Fatai Raheem and the National President of the Association for Formidable Educational Development(AFED), Mr Orji Kanu,  said their member schools cited cases of LIRS officials who visited their schools in recent weeks to demand tax payment.

While LEAMSP boss said the situation was almost general among member schools, Orji’s AFED said he also received such complaints from member schools in Mushin Local Government Area a few days ago.

“LIRS officials come serving our member schools bills almost every day,” LEAMSP boss said, adding that “And the problem is that we don’t have money.”

The stakeholders said they had expected the government would give them waiver for such payment at least for a full academic calendar year, beginning with the current term to enable them to stabilise financially a bit.

Chairman of the National Association of Proprietors of Private Schools (NAPPS), Mr Olawale Mohammed said though no member of his association had reported such a case to him since they resumed from the lockdown, he would not want to rule out the possibility as NAPPS members were many and spread.

However, the trio, who spoke separately to the Nigerian Tribune, lamented they were really in financial difficulties due largely to the COVID-19 pandemic, which they noted shut them out of business for about seven months, aside from the current economy recession that had made matters worse.

They said most of their students had not even paid their school fees, adding that some of them did not  bother to show up since reopening of schools not to talk of payment of any form of fee.

According to them, the situation was adversely impacting on their financial obligations to their workers, despite the fact that they were putting in extra efforts to make up for the lost period, and also to address other essential needs.

They disclosed that some of their members who were running their schools in rented accommodation could not even reopen because their landlords had ejected them for failure to pay their rent, adding that yet, those in this fold had no hope of meeting such obligation soon.

The landlords of such facilities, according to them, hinged their action on the premise that they also depended on rents for their survival.

NAPPS boss, however, pointed out some landlords who showed some levels of understanding of the current economic situation, and so had given some affected members of the association a saving grace of up to December 31 to pay up their outstanding rent or be ejected from the rented accommodation.

“This is the situation we find ourselves at the moment,” Mohammed said.

AFED boss disclosed that many of his member schools charge as low as N10,000 as school fee per student per term, adding that after payment of workers’ salaries,  rent and other overheads, owners were left with little profits.

Speaking further, NAPPS leader said it was surprising again that LAWMA decided to use commercial rates to bill private schools for waste collection, notwithstanding education business is a social service.

He said his members had been served a notice to that effect, adding that one school would pay as much as N30, 000 monthly for the service,  wondering the kind of refuse schools were generating that was equal to such huge amount.

But LEAMSP chairman said his member schools were already been billed the commercial rates by their waste collectors.

The spokesman of LAWMA, Mr Aromire Hakeem, told the Nigerian Tribune in his reaction that he was not aware of a proposition by LAWMA to start using commercial rates to bill schools for waste collection.

He, however, admitted that schools were classified among social service providers in Lagos State, and so LAWMA treated them as such.

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