As part of efforts to boost productivity and create more jobs in the economy, the federal government says there will be tax breaks for companies that employ more staff. This is one of the promises that President Bola Tinubu made during a townhall engagement organised by the Nigerian Economic Summit Group (NESG) during the 2023 presidential election campaign season.
During an interview on AIT, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun said the tax breaks will be included in the Inflation Reduction and Price Stability Order approved by the president.
“The Inflation Reduction Act will now contain a range of import duty exemptions, such as lowering of tariffs and outright tax breaks, for instance, for employment,” the Minister said.
“If you employ more people, you will be given a tax break against it. So that range of fiscal incentives will also be laid out in an executive order, which Mr. President will in due course sign.
“Where we are on VAT is that a whole range of items from CNG to pharmaceutical products and so forth are exempt from VAT. It’s an executive order. I will sign it. It is currently with the ministry of justice.
“Withholding tax, which essentially saves the working capital of companies, is removed for all manufacturing, many small and medium-scale enterprises, food production, food processing companies, a whole range. And it will be listed in an executive order, which I am also authorized to sign”, Edun stated.
When asked on the expected timeline for these measures to be rolled out, Wale Edun said the executive order will be out within two weeks.
“I would say that in the next week or two it should be out. It has to go through certain regulatory, certain legal processes, but there is nothing holding it up except just the administrative processing, which we will ensure will be quick,” he said.