The Management of Dangote Group on Monday debunked a story alleging that
the company will benefit 10-year tax holiday after constructing 35 km
Apapa to Oworonshoki highway end of the Lagos-Ibadan Expressway.
Speaking at the Ikoyi head office, on Monday, Group Executive Director,
Strategy, Portfolio Development and Capital Projects, Dangote Industries
Limited, Mr. Devakumar Edwin, revealed that the company has never
benefited any tax waivers or credits in its entire history except when it
is industry based and same applies to all industry players.
He explained that while the company volunteered to repair the Apapa road
as part of its Corporate Social Responsibility (CSR) initiative at no cost
to the Federal Government, the construction of Apapa to Oworonshoki long
highway will be done at 15 to 25 per cent less than the lowest bid.
According to him: “It is very painful when some people accuse our company
of benefitting 10 years’ tax rebate from the government. There is nothing
like tax credit in all these. We volunteered to construct the Apapa to
Oworonshoki long highway at a cost that will be about 15 to 25 per cent
less than the lowest bid on the road. We hope to get back our money after
three years by removing the sum from the tax we are supposed to pay.”
He further explained that the company proposed to the government to reduce
50 per cent of the total cost of the road, from its proposed tax, on its
first year after completion and 25 per cent of the costs respectively for
two years from its proposed tax.
“…the government came forward and said, good enough your company is
repairing a road that is very important to all Nigerians…is it possible to
help us do proper road construction of 35 kilometers from Apapa to
Oworonshoki? We advised the government to go for a competitive bidding and
also that we will take it up at a costs that will be lower than the lowest
bid received by the government. Since the government may not be handy with
cash, we proposed that we will recover our money over three years in
installments against our future tax. The reality is the government will
not pay us for the construction, but we will only offset our costs against
our three years tax.
It would be recalled that the federal government said it would give tax
relief to private sectors that invest in road construction in the country.
Speaking at the Road Construction Summit 2017 organised by Lafarge and
Business Day at the weekend in Lagos, the Minister of Power, Works and
Housing, Babatunde Fashola said that there are a lot of possibilities that
lie ahead when private capital comes into road construction under the tax
relief order as proposed to be amended and complements government
According to him, the government has just concluded an agreement using the
tax incentive order to hand over the Apapa area comprising Creek Road,
Liverpool Road, Marine Beach to Mile 2, Oshodi, Oworonshoki to the Lagos
end of the Toll Gate on the Ibadan Expressway to Dangote Group.
Also, he said the government has signed an agreement with NLNG to
construct the Bodo-Bonny Bridge at the cost of N120.6 billion with NLNG
and federal government sharing the cost.
“We have identified 28 toll plazas out of the old toll plazas, on roads
where construction work is currently going on, at which we propose to
restore toll plazas. We have also concluded traffic surveys on 51 major
highways and now have current traffic data on these roads and we can
project vehicular traffic movement for tolling and concession purposes,”
Going by the recent second quarter GDP report, the Minister said, “With
respect to construction and related activities, GDP in the sector had been
negative since Q2 2015, but turned positive for the first time in Q1 2017
growing by 0.15 per cent and continued to positive growth into Q2 2017 by
growing by 0.13 per cent. The reversal in construction has to do with
civil works especially due to FGN capital expenditure.”
Chairman, Lafarge Africa, Mr. Mobolaji Balogun noted that with the federal
and respective state governments grappling with dwindling resources, it
has become crucial that the ecosystem of public and private sector players
brainstorm on issues of funding, partnerships, design, and quality of
roads in Nigeria, as for sure government can no longer do it alone.