By Franklin Ocheneyi
“IF the Nigerian Investment Promotion Commission (NIPC) approves our applications the tax benefit in 2017 would be N62.2 billion (2016: N43.8 billion and 2015: N28.1billion).” This totaled N134.1 billion.
Dangote Cement Plc disclosed this in its Consolidated and Separate Financial Statements for the year ended 31st December, 2017.
In the document seen by Nigeria Industrial Digest, the company said: “The Directors of the Company have assessed whether the operations in Ibese production lines 1 & 2 and Obajana production line 3 are entitled to tax relief under the Pioneer Status Incentive (PSI).
“These production lines have already received Nigerian Investment Promotion Commission (NIPC) approval for the initial three years’ tax holiday and applications for additional two years extension have been submitted.
“While NIPC approval is yet to be obtained, the Directors’ strong view, supported by the opinion of the Company’s legal counsel, is that the Company has complied in full with the requirements of the Pioneer Status Incentive and is entitled to the two years extension.
“The tax benefit taken on the basis that the Company is entitled to two years extension under the Pioneer Incentive Scheme is N8.3B (2016: N24.0B and 2015: N27.8B).
“The Company has also applied for tax relief under the Pioneer Status Incentive for Ibese production lines 3 & 4 and Obajana production line 4.
“Approval is yet to be obtained from the NIPC for these applications. The Directors strong view is that the Company has complied in full with the requirements of the Pioneer Status Incentive and has no reason to believe that the approval will be rejected.
“However, the Directors have decided to make a provision against the Pioneer tax benefit while the Company continues to pursue approval for the Pioneer applications with the NIPC,” said the report.