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NIQS

NIQS seeks role in government’s infrastructure tax credit scheme

Nigerian Institution of Quantity Surveyors (NIQS) last week backed the Federal government’s new Executive Order on Road Infrastructure Development and Refurbishment Investment tax Credit Scheme, as they seek the inclusion of professionals, especially its members in the proposed management committee.
However, the innovative Order whilst very good in principle, they said, could fail due to many possible abuses and some lacunae that the Nigerian Institute of Quantity Surveyors (NIQS) has observed and which need to be tightly closed from exploitation.

President Muhammadu Buhari signed the Executive Order known as Executive Order 7 of 2019 recently. The aim is to develop and deliver Public Private Partnerships (PPP) with notable investors to bridge the road infrastructure gap in the transportation sector. About 19 road projects are to be undertaken by six leading manufacturing and construction firms, located in 11 States, and in six geo-political zones.

Speaking at a press conference organised by the institute in Lagos, NIQS President, Obafemi Onashile applauded the road infrastructure development and refurbishment investment tax credit scheme.

“This marks the very first time a government in Africa will look into providing capital projects through the use of fiscal policy such as tax breaks rather than the usual government direct funding or lease/concession arrangement through the private sector both of which have failed woefully in the past,” he said.

Onashile commended President Buhari for this bold step and initiative, which NIQS had clamoured for in the past few years.

“This confirms that this government is listening and ready to think outside the box in finding workable solutions to Infrastructure and housing problems in Nigeria.

“The QSs being professionals focused mainly on finance and completion of projects only, with no conflict of interest in project designs or supervision can surely bring a lot of expertise to bear in ensuring the success of the Order 7.

NIQS pledged its entire membership’s full support to the Minister of Finance who is the arrowhead to drive this new policy in ensuring the Order scores a huge success and becomes a model to be followed by other nations.

According to the body, contract procurement strategies is the “theatre” of their practice as such quantity surveyors is better placed to set the cost yardsticks to be used to determine what volume of infrastructure the private company must deliver in a year to equate to pre-determined tax level.

Specifically, Onashile advised that independent private quantity surveyors should also be engaged to creditably monitor and verify the construction and the total development costs such that the nation is not short changed from its income that is being used on its behalf.

He said: “Infrastructure delivery contracts are peculiar and require certain basic components of construction procedures to assure a smooth administration that can not be exploited to the detriment of the Government. It is not the typical “business contract of sale” that Lawyers draw up. It requires construction law expertise – quantity surveyor.”

Besides, the NIQS president stressed the need to separate technical supervisory roles from financial/contractual supervisory roles of representatives of the government.

Onashile queried, “investor companies are to pay taxes yearly, so how is the quantum of the project delivered in year by an investor being equated to estimated tax liability for the year?

“If an investor company is not making sufficient financial injection into the project, how can this be quickly detected because the implication is that such company is not paying tax as and when due.”

The body urged the government to extend the Order on road infrastructure development and refurbishment investment tax credit scheme to the housing industry to close the gap in the sector.

The NIQS comprising of members who are financial, contractual and administrative experts in engineering infrastructure and construction projects identifies with this new and innovative project delivery method.

Credit: Guardian

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