The Federal Executive Council (FEC) on Wednesday approved the proposal for business mogul, Aliko Dangote, to construct Lokoja-Obajana-Ilorin Road. In return, Dangote will hold back 30 percent of his company’s income tax for some years.
The Minister of Power, Works and Housing, Babatunde Fashola, disclosed this to State House correspondents at the end of FEC meeting presided over by President Muhammadu Buhari.
He said: “We presented a memo to council for consideration. The memo seeks to take benefits of the existing policy and regulation. It seeks to take benefits of tax policies, tax laws for the purpose of using them to drive infrastructural development renewal.
“So we presented a proposal by one of the subsidiary of Dangote group, a construction company, for the construction of a section of Lokoja-Obajana-Kabba-Ilorin, specifically the section between Obajana-Kabba Road using cement as demonstrative of how perhaps we should continue to build going forward in order to reduce maintenance on the road and the company proposing to fund the construction of that section of the road in exchange for some tax remissions.
“Companies are ordinarily suppose to pay income tax. There are existing policies in our laws which enable government to consider and give taxes incentives.
“So Council consider and approved the proposal for Dangote construction company to build that section of the road because the tonnage of cement being produced from the factory has increased and the traffic in that area has increased, there had been unfortunate accidents also.
“So it is a total economy policy which council considered and approved because it gives support to industry, it enables us take benefit of our tax law to renew infrastructure at a time we are really challenged for resources to finance all our routes. It also enables us to save lives by quickly and urgently rebuilding that road so that other commuters who also depend on that road for their livelihood would also benefit from the road.”