The Nigerian Investment Promotion Commission has announced that it approved tax holidays for 34 companies seeking tax incentives and waivers under the Industrial Development Income Tax Act in 2023. This move is part of the government’s efforts to attract foreign investment into the country. The disclosure was made by the Head of incentives administration, Lovina Kayode, during an end-of-the-year press briefing organized by the commission in Abuja.
Tax incentives have been a contentious issue due to the significant amount of revenue lost to waivers granted every year. The Federal Government previously stated that companies operating in Nigeria receive tax incentives worth N6 trillion annually, prompting the Chairman of the Presidential Tax Reform Committee, Mr. Taiwo Oyedele, to announce a comprehensive review aimed at reducing tax waivers.
Despite earlier reports indicating that companies like Dangote Sinotrucks West Africa Limited, Lafarge Africa Plc, Honeywell Flour Mills Nigeria Plc, Jigawa Rice Limited, and Stallion Motors Limited had benefited from tax waivers, Lovina emphasized that not all companies are granted tax breaks due to stringent procedures followed by the commission on waivers award. She clarified that the pioneer status incentive allows a company to enjoy three years of not paying corporate income tax to attract more investments.
NIPC plans to publish impact reports on the effectiveness of the pioneer status report on job creation and other economic activities in order to promote investments. The commission’s Executive Secretary, Aisha Rimi, reiterated commitment to facilitating and assisting investors to gain inroad into the country in the New Year.
The commission’s emphasis on stringent procedures and the motivation to generate impact reports demonstrates Nigeria’s endeavor to ensure that tax incentives are allocated to deserving companies. As the country aims to attract foreign investment and promote economic growth, the effectiveness of these incentives will be closely monitored through impact assessments and job creation statistics, providing transparency and accountability in the allocation of tax holidays. With the commitment to facilitating and assisting investors, Nigeria’s intention to remain competitive in the global market is evident.
