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Dangote Group denies 10-year tax waiver agreement

Dangote Group denies 10-year tax waiver agreement

“The Dangote Group has said that it will not benefit from a 10-year tax waiver reportedly granted it by the Nigerian government.”- Premium Times

Speaking in Lagos on Monday, the Group Executive Director, Strategy, Portfolio Development and Capital Projects, Dangote Industries Limited, Devakumar Edwin, said the company has never benefited from any tax waiver or credits except when it is ”industry-based and applies to all its competitors.”

Mr. Edwin was reacting to criticism that trailed the announcement of the said tax waiver by the Nigerian government.

Earlier in September, the Minister of Power, Works and Housing, Babatunde Fashola, had announced the government’s decision while speaking at the Businessday Road Construction Summit, held in Victoria Island, Lagos.

Mr. Fashola revealed that the government had reviewed the five-year limit on tax order enjoyed by the company to a 10-year period to sustain private investment in road infrastructure because it is a long-term asset.

The minister also announced that construction of the Apapa to Oworonshoki end of the Lagos-Ibadan expressway had been handed over to the company.

But many Nigerians expressed reservations about the announcement.

In separate interviews with PREMIUM TIMES, tax experts and civil society organisations officials also expressed concerns about the agreement.

But speaking on Monday, Mr. Edwin debunked the claim that the company will benefit from a 10-year tax holiday after constructing the 35 kilometres Apapa to Oworonshoki highway end of the Lagos-Ibadan Expressway.

The Nation newspaper reported that he explained that while the company had volunteered to repair the Apapa road as part of its Corporate Social Responsibility at no costs at all to the Federal Government, the construction will be done at 15 to 25 per cent less than the lowest bid.

“It is very painful when some people accuse our company of benefitting 10-year tax rebate from the government,” he said.

“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 added.

Mr. Edwin also reiterated that the company proposed to the government to reduce 50 per cent of the total cost of the road, from its proposed tax, in 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, ‘You guys are repairing the road, good enough but this road is very important to all Nigerians…Is it possible to help us do proper road construction of 35 kilometres from Apapa to Oworonshoki?’

“We advised the government to go for a competitive bidding and also that we will take it up at a cost 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 in three years in installments against our future tax, so in fact, the government will not pay anything to us, we will only offset our costs against our three years tax, so government will not pay us a dime for the road and it is not as if we are not paying tax,” he argued.

Mr. Edwin also claimed that his company had previously built a 24-kilometre concrete road at Ibeshe, Ogun State that cost N8.7 billion at no cost to the government.

According to him, the company also help construct the Obajana-Kabba 44 kilometre highway which government contractors gave a bill of N16 billion but the company offered to construct at the cost of N6.9 billion.

“Our company should be commended rather than being vilified by detractors,” he said.

Source: Premium Times

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