The Federal Inland Revenue Service (FIRS) has rejected the three year old N2.59 trillion Tax Credit Scheme introduced by former President Muhammadu Buhari administration for road construction across the country.
This is coming just as one of the critical executors of the Tax Credit Scheme, the Nigerian National Petroleum Company Limited (NNPCL), cleared air on a $3.3 billion loan facility secured for the Central Bank of Nigeria (CBN) for stabilisation of Naira in the foreign exchange market.
The FIRS chairman, Zacheus Adedeji, rejection of the N2.59 trillion Tax Credit Scheme introduced through Executive Order 7 of 2021 by Muhammadu Buhari led government came when he appeared before the Senate Committee on Finance along with the chief financial officer of NNPC, Umoru Ajiya.
The Senator Sani Musa-led Committee had invited the duo to shed light on implementation of the scheme vis-a-vis the poor state of Federal Roads across the country.
While the NNPC chief financial officer , raised the hope of the committee members that the scheme is helping for refixing of dilapidated roads across the six geo political zones in the country with N664 billion spent so far , the FIRS boss , said the scheme was unlawful and should be discontinued .
“The Mandate of FIRS lumped with execution of Tax Credit Scene for road construction , is to access, collect tax and remit it into the federation account and not to appropriate it for any purpose through executive order.
“It is not the duty of the FIRS and NNPCL to be paying contractors. The Ministry of Works should be in line with its core mandate, allow it to award road contracts and pay for them.
“The scheme to so people serves as a faster way for road reconstruction or rehabilitation across the country, but we should stop increasing speed in the wrong direction.
“As a way of stopping the wrong approach, FIRS and CBN are holding a meeting with the Ministry of Works Friday this week, where stock would be taken of what has been done through the scheme and thereafter, to the right path .
“We should in a nutshell, not continue on the wrong trajectory”, he said.
Impressed by his submission, the Chairman of the Committee, Senator Sani Musa, said relevant provisions of the 1999 constitution (as amended), are against the scheme, because monies NNPC and FIRS are being made to spend on the roads through tax credit, supposed to be remitted into consolidated revenue fund.
“We are waiting for the outcome of the meeting of the three agencies involved in the scheme , before deciding on how to help the present government to correct mistakes of the past ,” he said.
On the $3.3billion loan facility, NNPCL informed the Committee members that it was secured to support CBN to suppress FOREX Volatility.
It said $2.2billion had already been secured for the apex bank while the balance of $1.05billion, would be credited to the apex bank before the end of the month.
