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IPPIS: OAGF Tackles ASUU Over Salary Deductions

By Tony Obiechina, Abuja

Office of the Accountant General of the Federation (OAGF) has refutted  reports by  the Academic Staff Union of Universities(ASUU) that under the IPPIS, salaries and allowances of lecturers were being over deducted by the government.

A statement by the OAGF Director of Information, Press and Public Relations, Mr.

Henshaw Ogubike in Abuja on Monday, quoted ASUU as allegedly saying that the deductions were such that “their take home is now only 50% or less of what they earn”.
But the Accountant General of the Federation explained that”The Pay As You Earn (PAYE) Tax is a statutory tax deductions paid by all salary earners.
IPPIS applied the correct rate in compliance with Section 34 of the 6th schedule on personal income tax (Amendment) Act of 2011. 
“Prior to migration to IPPIS, the rate of tax being applied by tertiary institutions was not correct, leading to underpayment of PAYE Tax.
“It is important to note that all states governments of the federation made claims on the federal government to pay the differential arising from underpayment of tax by these institutions. 
“The federal government has paid several billions on behalf of these institutions because of their underpayment of PAYE Tax. The request by the tertiary institution unions to formalize tax evasion through IPPIS is not only untenable, but unpatriotic request to violate extant laws on tax.NHF Deductions: 
“The National Housing Fund (NHF) is 2.5% of basic salary. This is another statutory contribution backed by the Act of National Assembly. This is a savings contribution by all federal employees to enable them have access to short life loans to own their personal houses. 
“These savings contribution are refundable with interest either at retirement or exit from being an employee of the federal government.
“The ASUU is bringing claims that those laws should not be applicable to them and thereby should be exempted or be made optional for them.  The request for breach of Act of Parliament is not within the ambit of the IPPIS or the (OAGF). They have been advised to approach the National Assembly for amendment of the Act.
“Another issue raised by the unions is the Employees’ Pension Contribution deductions. Employees’ Pension Contribution 7.5%. The ASUU claim that the Employee Contributory Pension should be based on basic salary and not on consolidated salary and it has increased their employee deductions thereby reducing their take home”.

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