The Nigerian Investment Promotion Commission (NIPC) has announced that it granted 34 companies there years tax exemption in 2023 to promote investment and rooster economic growth and development.
This tax exemption known as pioneer status incentives (PSI) is executed by the Incentives administration department of the NIPC and allows a company three years of tax exemption “The pioneer status incentive (PSI) is a tax holiday that grants qualifying industries and products relief from payment of corporate income tax for an initial period of three years, extendable for one or two additional year”
Lovina Kayode, Head of Incentives Administration, NIPC disclosed this during an end of the year press briefing at the Commission on Friday in Abuja.
According to her, not all companies are granted the incentives due to stringent procedures followed by the commission on waivers awards.
She noted that tax incentives, which had been a contentious issue due to the high amount of revenue lost to waivers granted every year, were meant to boost foreign investments into the country.
She said,“This process is stringent but our parent ministry Federal Ministry of Industry, Trade and Investment and the federal inland revenue service are involved to make sure the right investors get this incentive.
“So far this year, 34 applications have been approved and one of the things we intend to do is to ensure we are not just giving incentives to undeserving companies. However, there is already a notion that Nigeria gives out too many waivers, incentives, and concessions.
“However, tax expenditure which means what the government has lost by granting pioneers status incentive is just a small amount compared to what the country gains by granting these incentives to qualified companies.”
She further revealed plans by the commission to publish impact assessment reports on the effectiveness of the pioneer status report on job creation and other economic activities to promote investments.
“On impact, that is one thing NIPC is planning on, next year, it is one of our biggest tasks to do an impact assessment. These incentives we gave out, how have they impacted the country in terms of job creation?
“How many jobs are the companies creating and what kind of import substitution has come about because we have granted these incentives and how much would the government gain after the three years of them not paying these taxes,” she added.
Aisha Rimi, Executive Secretary NIPC, in her virtual address, reiterated commitment to facilitating and assisting investors to gain inroad into the country in the New Year.
She said, “So as I continue to settle down, I will also continue to depend on and rely on your support to promote the activities of the commission. The commission, as you all know, was set up really to facilitate, promote, and assist investors into the country and the ones already in the country. Because if nobody traps these people and gives them the support that they need, other countries are competing with Nigeria. So we have to be very intentional.
“So our job is to bridge that gap between private sector and government to ensure that our investors, foreign or domestic incoming, and the ones already here that we make sure that their experience and their economic activities in Nigeria are fruitful and beneficial.” Rimi reteriated.