The Nigerian National Petroleum Company Limited (NNPCL) cleared the air on a $3.3billion loan secured for CBN
The Chairman of the Federal Inland Revenue Service (FIRS), Zacheus Adedeji has condemned a three-year-old N2.59 trillion Tax Credit Scheme, which was implemented for nationwide road construction by the administration of former President Muhammadu Buhari.
This is in response to the Nigerian National Petroleum Company Limited (NNPCL), one of the key Tax Credit Scheme executors, clearing the air regarding a $3.3 billion loan facility secured for the Central Bank of Nigeria (CBN) to stabilise the value of the Naira in the foreign exchange market.
Adedeji revealed this during his appearance before the Senate Committee on Finance along with the Chief Financial Officer of NNPCL, Umoru Ajiya on Wednesday.
The duo were invited by the committee chaired by Senator Sani Musa (APC, Niger East) to provide insight into the scheme’s implementation in light of the deplorable condition of the Federal Roads across the country.
Despite Ajiya’s plea to the committee members, assuring that the N664 billion spent so far is helping in the repair of the dilapidated roads across the six geo-political zones in the country, Adedeji said the scheme was unlawful and should be discontinued.
Adedeji said, “The Mandate of FIRS lumped with the execution of Tax Credit Scheme 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 FIRS and NNPCL to be paying contractors. The Ministry of Works should be in line with its core mandate to award road contracts and pay for them.
“The scheme serves as a faster way for road reconstruction or rehabilitation across the country but we should stop increasing speed towards the wrong direction.
“As a way of stopping the wrong approach, FIRS and CBN are holding a meeting with the Ministry of Works on 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 maintained.
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Senator Musa, who was impressed by his submission, stated that the plan violates relevant provisions of the 1999 constitution (as amended) because tax credits that should have gone to the consolidated revenue fund instead are being used to pay for road improvements by NNPC and FIRS.
“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.
NNPCL informed the members of the Committee regarding the $3.3 billion loan facility, stating that it was achieved to support the CBN in reducing FOREX volatility.
It stated that the apex bank had already secured $2.2 billion and that the remaining $1.05 billion would be credited to it before the end of the month.
