FEC announces tax holiday to 27 industries tax holiday
The Federal Government has announced a tax holiday ranging from between three and five years to fresh 27 industries.
This followed the amendment of the list of pioneer industries and products at the Federal Executive Council (FEC) meeting presided over by Acting President Yemi Osinbajo, yesterday.
Minister of Trade and Investment, Okechukwu Enelamah, at the post-FEC briefing explained that already matured industries, have been given a three-year window before finally taking them off the pioneer status list. He explained that the incentive scheme is meant to woo investors and in return raise the country’s tax base.
While the 27 industries were accorded pioneer status, mineral and oil prospecting governed by the Petroleum Profit Tax as well the cement industry which is deemed to have matured were struck off the list.
The Minister of Trade and Investment who briefed alongside the ministers of Power, Works and Housing, Babatunde Fashola, Science and Technology, Ogbonaya Onu and Information, Lai Mohammed, said the list was last reviewed in 2006, noting that the scheme is an incentive to make people enter Nigeria’s market, enter new industries, invest more for companies already existing in the country.
“FEC approved a memorandum that was presented to amend the list of pioneer industries and products that will enjoy pioneer status going forward. Many of you know the pioneer incentive scheme is governed by the Industrial Development Income Tax Relief Act and the whole purpose is to give tax holidays to industries we consider pioneer.
“Pioneer doesn’t mean that they are new it only means that they are not yet mature, we want those industries to grow. We want to attract investment in them and you will find that this covers a wide range of industries and those tax holidays ranges from three-five years,” he explained.
He noted that in carrying out the review special attention was paid to the Economic Recovery and Growth Plan (ERGP) to capture the current realities that will help to implement the plan to ensure the country attract the kind of investment, industries and players that would help to implement and realize its objectives in the ERGP.
He stated that multi stakeholder engagement, both private and public sector, were consulted in arriving at the industries that will be included in the pioneer incentive scheme.
According to Enelamah, council approved some recommendations to “remove all ambiguities in the definition of industries by reclassifying industries according to the international standard in industrial classification which is the global standard which is also the standard that is used by the Nigeria Bureau of Statistics.
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