The Road Infrastructure Tax Credit Scheme has been described by the Executive Chairman of the Federal Inland Revenue Service (FIRS), Muhammad Nami as one of the greatest innovations of the Federal Government in its resolve to tackle Nigeria’s infrastructure deficit.
The scheme which provides for public-private partnership intervention in the construction, refurbishment and maintenance of critical road infrastructure in the country with participants being entitled to Tax Credits against their future Companies Income Tax was the subject of debate at the Senate Stakeholder and Public Hearing on the 2023 Medium-Term Expenditure Framework (MTEF) and Fiscal Paper, which held yesterday at the Senate Chambers.
“I think one of the greatest innovations of the government of the day is the Executive Order 007, which was signed into law in 2019,” Mr. Nami said.
“I want to speak to the one we are handling jointly with the NNPC. The NNPC through its subsidiary for instance is investing in about 1,824 kilometres of roads across the 6 geopolitical zones in Nigeria.
“Some of these roads had been constructed as far back as 1976. I could remember when I was still rounding up my primary school education, the road that leads Suleja to Lapai-Agaie-Bida was constructed by a company called DTV. I am not aware of any significant work done on that road 40 years later, only until now when the NNPC is using Executive Order 007 to reconstruct the road.
“I can report authoritatively to the Chairman and members of this committee that from December 2021 to July this year, the contractor has completed the reconstruction of well over 50 per cent of that road.
“The challenge of road construction in Nigeria has always been funding. Yes, there are contracts for the construction of roads, but funding these constructions is the challenge.
“The road leading from Suleja to Minna for instance was awarded some 11 years ago to a company for over N20 billion. Ironically, annual budgetary provision in our National Budget every year stands between N150 million to N200 million per annum. If we are to complete that road, going by the annual budgetary provisions it would take an average of 35 to 40 years before we finish it.
“I can confirm to the Chairman that with Executive Order 007, NNPC is now providing funds and in the next two to three years that road will be completed. This is an important innovation of the government and I would plead with this distinguished Committee of the National Assembly to support the government on it,” Mr. Nami noted.
Supporting the position of the FIRS Executive Chairman, the Minister of Finance, Budget and National Planning, Hajia Zainab Shamsuna Ahmed explained further that the tax credit was only provided to the beneficiaries after completion of the construction work, and not before.
She noted that several companies had indicated interest in carrying out construction and rehabilitation of roads under the scheme across the country, adding that while some of these companies had commenced work, others were yet to as they were still finalising on some of the documentation requirements such as Bill of Quantities.
On the issue of revenue challenges being faced by the country, Mr. Muhammad Nami noted that a major cause of tax revenue loses for the country is the issue of having “fragmented tax systems and agencies.”
“In Nigeria we have 774 Local Governments, each of them have a tax authority; each of the 36 States, too, have revenue authorities with their respective mandates; then we have the FIRS and Customs. What I would advise for efficiency and to do things in line with global best practices, is that we should amend our tax laws to harmonise the tax agencies and tax system.
“With this, when the FIRS, for instance visits ‘Company A,’ it can serve one assessment on the company, and also on the individual that owns the company; it can also ask the company to account for the VAT it has collected, and ask for PAYE it has deducted from its employees as well as the Personal Income Tax of the Promoters of the Company.
“This is currently not the case, and as such has created a huge gap in our tax system.”
The Senate Finance Committee, led by Senator Solomon Adeola charged the Federal Government through the Ministry of Finance and members of the government’s economic team to explore novel strategies that would shore up revenue for the Federal Government, including restructuring the remitting formula for Government Owned Enterprises (GOEs).
The Committee urged the Federal Government to consider a situation where Government Owned Enterprises (GOEs) remit 100 per cent of their revenue to the government, while being funded by a determined percentage of Cost of Collection as is the case with the FIRS and Customs.
Arguing for this, the Committee opposed the current situation where some government agencies were retaining hundred per cent of their revenue, spending from it, and paying government operating surplus.
The Committee recommended that these GOEs should keep only 5 to 15 per cent as their cost of collection from the revenue generated to cater for their salaries, operational expenses and capital expenditure as is currently done by the Nigerian Customs and FIRS, while remitting the difference of 85 to 95 per cent of their gross earnings as against the current practice of operating surplus where they spend between 70 and 90 per cent of their gross earnings.
The Committee noted that this also has the capacity to make them put in more effort to improve their revenue when compared to the FIRS and Customs.
The Committee further urged the Federal Government to apply the same logic to the running of government owned universities by providing funding for only research and infrastructure needs through the Education Tax already being administered by the FIRS, while allowing the Vice Chancellors to use the revenue from school fees and other innovative revenue sources to run the Universities.
Join us or we meet in 2027 — Tinubu tells Labour
..Commisions Lagos Red Line Rail project
…insists Nigeria will be out of economic problems,
…Red Line Rail to transport 750,000 passengers daily
By Moses Adeniyi
President Bola Tinubu on Thursday replied the Organised Labour over their protests against troubling economic situation in the Country, calling for support for his government ‘to make Nigeria work.’
President Tinubu who noted that the Organised Labour has embarked on strike four times in about nine months of his government, gave them an option to either join fellowship to work hand in hand with his administration, or should they choose “to be political,” they should meet his government at the polls in 2027.
“The Labour has gone on strike four times within my nine months in government. That’s a record. However, they should join us to make Nigeria work as we are currently doing, otherwise if they want to be political, they should meet us in 2027,” President Tinubu said on Thursday when he inaugurated the first phase of the Lagos Rail Mass Transit (LRMT) Red Line project.
Calling on Nigerians to embrace change and work towards national progress, he reaffirmed his administration’s commitment to eradicating corruption and called on labour unions to refrain from disruptive actions.
‘’Some labour unions should understand that no matter how we cling to our freedom and rights, to call for strikes within the first nine months of a new administration is unacceptable.
‘’If you want to directly participate in the electoral process, wait until 2027, if not, maintain the peace. Labour is not the only voice of Nigeria,’’ the President affirmed.
The Lagos Rail Mass Transit (LRMT) Red Line project is a 37km project expected to reduce travel time and improve transportation and logistics in the state.
The President on Thursday also witnessed the signing of the contract for Phase 2 of the LRMT Red Line project by the Managing Director of Lagos Metropolitan Area Transport Authority (LAMATA), Engr. Abimbola Akinajo, and the Chairman of CCECC Nigeria Limited, Jason Zhang.
The President, before departing for a state visit to Qatar on Thursday, embarked on an inaugural train ride from the Ikeja station to the Agege station, accompanied by Lagos State Governor, Babajide Sanwo-Olu; Deputy Governor of the State, Dr. Obafemi Hamzat; some state governors; members of the Federal and State Executive Councils; members of the Federal and State Legislative Assemblies; Chinese Ambassador to Nigeria, Cui Jianchun, and a select group of journalists.
Addressing a gathering of Nigerians at the train station in Ikeja, President Tinubu directed the Minister of Transportation, Senator Sa’idu Alkali, to ensure that the federal and subnational governments strengthen their collaboration to provide reliable, efficient, and affordable transportation systems for all Nigerians across the country.
‘’Today, I am seriously honoured that I am a Lagosian and the first to be President of the Federal Republic of Nigeria.
‘’My promise is not to let you down. We will arrive at the destination with joy, happiness, and prosperity; God willing,” he said.
Reflecting on his tenure as the former governor of Lagos State, when the vision of a modern and effective public transportation system in the state was conceived, President Tinubu described the project as a dream realised and a fulfillment of years of hard work and dedication by successive governments.
‘’I am very happy indeed that today is a day to remember in Nigeria’s infrastructural history, particularly Lagos, the centre of excellence. Today is evidence that it is good to dream, and it is a serious validation of democracy as a form of government of the people, by the people, and for the people.
‘’When you put people at the centre of your vision and planning, you will realise the value of democracy.
‘’Twenty-five years ago, I was elected to lead Nigeria’s most populous state. From the very beginning, my team and I toiled day and night with a very bare cupboard and amidst pervasive deficiency to implement a developmental vision that would transform Lagos into an economic powerhouse. Today, we are realising that dream.
‘’The momentum of greatness we kickstarted a quarter of a century ago has become unstoppable progress. It is not a crime to dream and dream big. Just stay focused and make development a central focus,” he said.
President Tinubu commended the Lagos Metropolitan Area Transport Authority (LAMATA), the urban transport agency which was established under his watch as Lagos State Governor over 20 years ago, for its exemplary performance and implored LAMATA to sustain the momentum in completing all other phases of the Red Line project, as well as the full execution of the broader rail blueprint of the state.
“Thank God LAMATA as a public sector institution and Lagos State as sub national government has moved strong and constant that true change is possible,” he said.
Further commenting on efforts he said, “Let me commend here the Governor of Lagos State, Babajide Sanwo-Olu for the giant strides. He was part of the vision. Some 20 years ago, I sent them around as their governor and leader to look at the system, to other parts of the countries and they worked hard. .
“I am delighted that as we inaugurate the first phase of the Red Line. We cannot afford to rest on our oars, more work still need to be done at national and subnational level, no room for complacency. I look forward to the completion of the other phases.
“I perceived massive economic opportunities coming out of this. I am assuring that Nigeria will be out of economic problems, we just need to persevere, work hard and be assured.”
On the issue of corruption, the President said, “we will be on it, we are not looking back.”
“I speak to Nigerians through this podium that change is possible and change is possible and change we must achieve, progress we must achieve.
“We cannot afford to relax the burgeoning population, we must plan and prepare for it, we must be committed to a great value. This economy, we blow it, we will build ourselves out of the penury and will be happy that we did it
“Taking a close look at work in aviation, what is our problem, if it is corruption, we must exterminate it.
“No matter how hard it is fighting back, no to corruption, we must adhere to our pledge, patriotism, perseverance, consistency and stay open.”
On the need to blend national efforts with those of subnational governments, he said: “The national transportation minister is here. It is very critical for your Ministry to collaborate further with sub-national government, to help build a Nigeria for the greatest number.
“Nigeria must be able to enjoy access to multiple alternative modes of transportation all of which are safe, efficient and affordable.”
Remarking, Governor Sanwo-Olu explained that the first phase of the project, executed by the State Government, spans 37 kilometers and shares the track of the Nigerian Railway Corporation (NRC) Lagos-Ibadan modernisation project from Ebute Metta to Agbado with stations at Oyingbo, Yaba, Mushin, Oshodi, Ikeja, Agege, and Iju.
According to Sanwo-Olu, phase one of the project will transport 750,000 passengers daily at inception and 1.1 million passengers daily once it is fully operational.
‘’All the stations are live and ready to receive passengers,’’ Sanwo-Olu said.
Sanwo-Olu described the ceremony as a “culmination of long, painstaking journey” of reforms in the transportation sector of the State, stressing that the commissioning of the rail system, once again, breathed life into Tinubu’s vision of integrated transport connectivity.
The Governor said the Strategic Transport Master Plan (STMP) of Lagos outlined six integrated rail lines, one monorail, 14 BRT corridors, over 20 water routes, and a vast network of major and inner roads.
Two of the rail lines had been completed, he said, acknowledging the contributions of his predecessors — Fashola and Ambode — towards the accomplishment of the State’s rail projects.
He said, “Today, we mark a historic milestone in the annals of Lagos and indeed, our nation, with the commissioning of the Red Line, a 37-km marvel of modern engineering that stretches from Agbado in Ogun State to the iconic National Theatre in Iganmu. The segment we are inaugurating today spans an impressive 27-km from Agbado to Oyingbo, featuring state-of-the-art stations at Agbado, Iju, Agege, Ikeja, Oshodi, Mushin, Yaba, and Oyingbo.
“For the first time in the history of Lagos, we have a system comprising and integrating all three modes of transportation: road, rail and waterways. We started construction of the rail infrastructure mid-2021, and I am happy that our administration has been able to complete for operations. At full capacity this first phase of the Red Line will transport 250,000 passengers daily, which will grow to 750,000 passengers daily when we have the full complement of rolling stock on the line.”
While speaking to reporters aboard the train during the inaugural ride, President Tinubu assured Nigerians that their lives will only become more enjoyable as modern amenities are built across the entire nation under his progressive leadership.
“This is very efficient and comfortable, and I am happy. Our transportation system must be all about the people. We have cut down imports on PMS by almost 50 percent. We need mass transit to complement the daily efforts of citizens and make things easier for our people. And this is what this is all about. It is about the people. It is about democracy. We are happy about it,” President Tinubu stated.
The first phase of the 37-kilometre rail line, constructed by the Lagos Metropolitan Area Transport Authority (LAMATA), was commissioned with seven stations built along its corridor, traversing Agbado — a boundary town in Ogun State — to Oyingbo in Lagos Central.
The Red Line was inaugurated exactly 12 months after the State’s first light rail — Blue Line — was inaugurated by former President Muhammadu Buhari. The 13-kilometres project, started by ex-Governor Babatunde Raji Fashola, traverses five stations between Mile 2 and Marina.
Six Governors, led by the chairman of Nigeria Governors Forum (NGF) and Governor of Kwara State, Mallam AbdulRahman AbdulRazaq, were among the first set of passengers who joined the President alongside Gov. Sanwo-Olu in a ride on the train, following the commissioning at the Ikeja mega station in the State Capital.
Illegal arms: FG recovers 80,000 ammunitions
The Federal Government (FG) of Nigeria through the National Centre for the Control of Small Arms and Light Weapons (NCCSALW) has retrieved 80,000 arms and ammunitions.
The North West Zonal Coordinator of the centre, Retired Air Vice Marshall Haruna Mohammed disclosed this during a stakeholders meeting at Bukavu Barracks on Thursday in Kano.
According to him, the centre recovered 20,000 small arms and 60,000 units of ammunition in Nigeria.
Mohammed explained that the centre was determined to eliminate small arms and light weapons in the region and the country as a whole.
He said that the centre was tasked with formulating and implementing strategies to eradicate arms proliferation.
He further emphasised that the recovered weapons often had trade markings, enabling the identification of their source countries and manufacturers.
According to him, NCCSALW used kinetic and non kinetic measures to recover the weapons and ammunition.
Mohammed added that synergy between security agencies and different stakeholders had eased the task of the centre.
“The centre’s engagement underscores the commitment of NCCSALW in achieving a weapon-free environment and ensuring the safety and development of the Nigerian society,” he said.
He warned against illicit circulation of arms, urging Nigerians to support the efforts of the government in curbing insecurity created by the proliferation of small arms and light weapons.
Earlier, the Assistant Director of Strategic Communications at the centre, Brig-Gen. Mohammed Sani, said the institution was established on May 3, 2021 in line with Article 24 of ECOWAS Convention on Small Arms and Light Weapons.
Sani said that all hands must be on deck in support of the efforts of the government at curbing the security challenges in the country.
Some of the participants who spoke at the event called on the government at all levels to fight drug abuse and create jobs for youths to prevent them from dealing in illegal arms.
Seplat Energy’s gross profit rises to N349.3bn in 2023
…Receives approval for operation of OML 40
Seplat Energy Plc has recorded a growth in gross profit in its twelve months ended 31 December 2023 results.
The energy company reported a gross profit rise of 14.5 percent from N197.2bn to N349.3bn, and achieved more than 8.7 million hours without Lost Time Injury (LTI) on Seplat-operated assets in 2023.
It also recorded a growth of 12 percent in revenue from N403.9bn to N696.9bn.
In a press statement, the company revealed that the Board recommended a special dividend of US 3 cents per share, in addition to Q4 2023 declared dividend of US 3 cents per share. Core dividend declared for 2023 is US 12 cents per share, up 20 percent on 2022. Therefore, the total dividend declared is US 15 cents per share.
Seplat Energy’s 2024 production guidance is put at 44-52 kboepd. Guidance assumes availability of TNP from 3Q 2024, and assumes ANOH contribution in line with guidance.
Initial 2024 capex guidance is $170-200 million. Drilling capex flat on 2022 (13 wells in base plan). Seplat will fund capex on Abiala, a marginal field development tied into OML40.
The company also announced that it has obtained regulatory approval for the full lifecycle Field development plan (FDP) for the Sibiri oil discovery on OML40.
Commenting on the results, Chief Executive Officer, Seplat Energy Plc, Roger Brown said, “Seplat Energy’s 2023 results illustrate the Company’s ability to deliver production growth, fortify our balance sheet and reward shareholders despite facing some unexpected challenges during the year.
“Operational performance was strong, production increased 8 percent over 2022 and we recorded the lowest level of reconciliation losses seen in recent years, a testament to the improving security efforts on the Niger Delta. Drilling yielded positive results, and I’m pleased to report strong 2P reserves growth, up 9 percent on prior year estimates. Our revenue exceeded $1bn, and while costs increased, our proactive approach meant we generated more than $260m of free cash flow in the year, allowing us to continue rewarding our shareholders and further reduce net debt.
“Our strong financial position, excellent operational performance and robust outlook means that we are delighted to declare a special dividend again this year, lifting the total dividend for the year to US$15 cents.
“In 2024, we look forward to a number of key growth events. We are moving forward on both the Sibiri and Abiala developments on OML40. Clear progress is also being made on the important ANOH gas project, with first gas expected in 3Q 2024. Finally, we have high confidence that we will conclude the transformational acquisition of MPNU this year.
“I’m delighted to welcome Mr. Udoma as Seplat Energy’s new Chairman and Mr. Rabiu as SINED and wholeheartedly thank Mr. Omiyi and Mr. Okeahalam for their longstanding support and guidance. Nigeria’s Oil & Gas industry is going through a generational change and as we reach our tenth year as a listed company, we fully intend to play an important role as Nigeria’s leading independent company.”
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