FG gives N1.02 trillion concessions to businesses in 4 years
- 1st December 2020
- Posted by: Hakeem
- Category: Business plans
The Federal Government disclosed on Monday that it has conceded about N1.024 trillion import duty waivers, concessions, and grants to drive economic growth in the country in the past 4 years.
This disclosure was made by the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, at a one-day sensitization seminar on the Automated Import Duty Exemption Certificate, held at the Nigeria Customs Training College, Kano.
According to a report from News Agency of Nigeria, the Minister, represented by the Kano State Commissioner of Finance, Alhaji Shehu Na-Allah Kura, said between 2011 and 2015, the FG had conceded about N1.024tn through the grant of four types of incentives including import duty waivers, VAT waivers, pioneer status non-oil companies, and pioneer status PPT on oil companies.
Ahmed said, “For the records, between 2011 and 2015, the government conceded about N1.024 trillion through the grant of only four types of incentives namely import duty waivers, concessions; grants, N503.587billion, Value Added Tax (VAT) waiver, N227.789billion, Pioneer status on non-oil companies, N73.511billion; and Pioneer status on oil companies, N219.545billion.”
While pointing out that the government also granted approximately N341.94 billion waivers between August 2017 and August 2019, the Finance Minister said the basis for providing these incentives was to stimulate growth and overall development.
She disclosed that the granting of the incentives was not discretionary but was targeted at sectors with kinetic capacity for high impact multiplier outcomes on the overall economy. These sectors include agriculture, power, cement, solid minerals, utilization of Nigerian gas, Liquefied Natural Gas (LNG), modular refineries and so on.
She also said that with the scope of the requests for waivers and concessions, expanding has brought about the need to have in place modern technology to drive its administration.
She said, “Up till March 2020, we processed the grant of the IDEC incentives annually. The process was quite cumbersome, tedious, time consuming and it was beset with undue human interface with its attendant challenges. The automated IDEC portal will deliver benefits online with the ministry’s Strategic Revenue Growth Initiative (SRGI).”
According to her, the FG created the new platform for administering and easing the process of acquiring import duty exemption certificate (IDEC) in the country, as part of efforts to provide incentives to stimulate industrialization and economic growth and promote the ease of doing business in the country.
What you should know
- The granting of import duty waivers, concessions and grants by the Federal Government to investors are part of measures attract investments into the economy and stimulate economic growth.
- IDEC is a tool used by the FG in achieving some of its fiscal policies of increasing economic activities and employmentS in certain target sectors.
- However, part of the problem of this policy is that it has allegedly been a subject of abuse by some top government officials. The automated IDEC is expected to guarantee ease of doing business and ensure effective tracking of fiscal incentives that have been granted and ensure accountability.