EDUCATION TAX ACT
Act · Education
Policy date: 2011-01-01
An Act imposes a 2% tax on companies' assessable profits to fund education. It targets all companies paying income tax and directs funds to tertiary institutions through the Tertiary Education Trust Fund. This generates dedicated revenue for improving education quality.
EDUCATION TAX ACT
What Is This Policy?
The original Act imposing a 2% education tax on companies' assessable profits to fund education, now superseded by the Tertiary Education Trust Fund Act which continues the levy under the TETFund framework.
Who Does It Target?
All companies paying Companies Income Tax FIRS as the collecting authority TETFund as the disbursing body (successor) Universities, polytechnics, and colleges of education
What Does It Aim to Achieve?
Generate dedicated funding for tertiary education institutions through a statutory levy on corporate profits, separate from the annual government budget.
Key Features
Education Tax: Imposes a 2% tax on the assessable profits of all companies, payable to TETFund. Dedicated Fund: Revenue goes directly to TETFund for distribution to tertiary institutions. Institutional Allocation: Funds allocated to universities, polytechnics, and colleges of education for capital projects. Accountability: TETFund publishes annual reports on fund collection and disbursement.
Current Status
Rollout Stage: Superseded by TETFund Act 2011 — the 2% levy continues under TETFund Coverage: All companies in Nigeria Beneficiaries: Tertiary education institutions; students Funding: 2% corporate tax levy
How to Access
Companies must remit the 2% education tax when filing CIT returns Tertiary institutions apply to TETFund for funding allocations TETFund project monitoring is required for funded projects Application method: Pay education tax to FIRS; institutions apply to TETFund at https://www.tetfund.gov.ng
Important Terms
The 2% levy remains in force under TETFund Act 2011 Non-payment attracts the same penalties as CIT default TETFund funds must be used only for approved capital projects
Official Resources
Website: https://www.tetfund.gov.ng Contact: Tertiary Education Trust Fund (TETFund)
Legal Framework
The Education Tax Act is the predecessor legislation to the Tertiary Education Trust Fund Act 2011 (TETFund Act). It imposed a 2% education tax on companies' assessable profits under the Companies Income Tax Act framework. Constitutional authority derived from the Second Schedule of the 1999 Constitution. The TETFund Act 2011 superseded the Education Tax Act while continuing the levy under the TETFund institutional framework.