The Senate has ordered the complete release of the N2.7tn Tax Credit Fund in order to fast-track the completion of ongoing road projects across the country.
The Chairman of the Senate Committee on Finance, Senator Sani Musa, (APC Niger East), made the disclosure when the Minister of Works, Senator David Umahi, appeared before the committee.
He said “Tax Credit Policy is a welcome initiative meant for exigencies being addressed and based on submissions made by the Minister, the N2.7tn, should be released for completion of Ongoing projects under the scheme.”
He however added that fresh implementation of the policy outside the N2.7trn should be halted for now.
Part of the N2.7tn had been released by the NNPCL for road construction. Also, President Bola Tinubu has reportedly ordered the termination of non-performing road rehabilitation contracts in the N2.7tn tax credit scheme.
The Chairman of the Federal Inland Revenue Service, Zacch Adedeji, had at an interface with the committee two weeks ago, kicked against the N2.7tn requested by the Ministry of Works through the Nigerian National Petroleum Company Limited to fund roads projects under the Tax Credit Scheme.
However, Umahi told the committee on Thursday that the N2.7tn was not a fresh request but a funding gap incurred as of January this year.
He explained to the committee that the Tax Credit Scheme had helped the nation to get some critical roads across the country rehabilitated or reconstructed within the last three years.
He said, “Tax Credit simply means front loading of taxes of the affected agencies involved and using it for infrastructure development.
“A very good example of it was the Apapa-Oshodi road, reconstructed by Dangote Plc under the scheme which not only solved the problem of congestion on the road but provided a solid road that can last 50 years life span.”
Umahi added, “It is the same road infrastructure solution the N2.59tn tax credits being offered through NNPCL offering but not well funded yet.
“ Only N650bn has been released through two batches for funding execution of the affected roads under the scheme, making the N2.7tn funding gap very necessary. We need the funds for the completion of roads already started under the scheme.”
He added that aside from the scheme, the ministry, based on the provisions made in the 2024 budget, has no concrete appropriations for road construction.
Umahi further added, “2024 budgetary provisions for the Federal Ministry of Works which are slightly above N1tn are palliatives for road construction, the reason why the National Assembly should make substantial appropriation for road infrastructure across the country.
“In doing that, at least N4.4tn, should be appropriated for 100kilometres road construction per each of the six geo-political zones.”
