Nigeria plans tax incentives to boost private sector initiative in road constructions

In a bold move to bridge its infrastructural deficit, Nigeria may resort to a novel method; tagged tax recovery funding scheme to rebuild some of its major roads.

Dropping the hints in Abuja on Tuesday, the country's Minister of Power, Works, and Housing, Babatunde Fashola, said the new initiative became necessary due to declining revenue hampering the rapid execution of important economic projects.

Fashola said the government is planning to explore innovative means of funding infrastructure projects and would be willing to offer some companies tax reliefs in the hope to get them to undertake key road projects within their catchment areas.

He noted that such companies with the capacity and willingness to reconstruct existing or build new roads in the country would be encouraged by the government to go ahead, and subsequently claim tax relief as recompense for their investments.
“We welcome other like-minded individuals and companies who have that kind of money to intervene in certain roads, and claim tax relief back," the minister said.
According to him, “What it really means technically is that government is spending in advance the taxes that it should collect to quickly respond to places where there is pain because some of these companies, if they make profit should pay tax at the end but the government is saying if they spend some of the tax on public infrastructure they will get some relief. We commend and welcome this initiative.
He said the government considered the new initiative as the long-term solution to the lockdown in Apapa.