The Nigerian Investment Promotion Commission has rejected the application of 15 companies seeking pioneer status under the Industrial Development Income Tax Act.
The 15 companies whose applications were rejected are Umugini Asset Company, Aristocrats Industries Ltd, Guinness Nigeria Limited, StrongPack Limited, Grit System Ltd, Scott Industries Limited and Flexipack Ltd.
Others are Ultimus Constructions Ltd, NG Clearing Ltd, Dangote Ibese Lines 3 and 4, Dangote Cement Obajana Line 4, Promasidor Nigeria Ltd, Daraju Industries Ltd, West African Packaging Ltd and Flour Mills of Nigeria Plc.
Providing reasons for the rejection, the NIPC in it’s second quarter pioneer status incentive report stated that the requests from two out of the 15 firms were time barred, while the activities of 10 other firms were not covered under the pioneer status-incentive list.
An analysis of the the report obtained from the NIPC showed that while 15 companies had their applications rejected, approval in principle was given to 10 firms.
The report stated that two firms had their applications extended while 181 other applications were still pending.
It put the number of firms currently benefiting from the tax incentive scheme at 32 while 104 companies had abandoned their applications with the NIPC.
The pioneer status is an incentive from the federal government which exempts companies from income tax. It is also known as tax holiday and generally regarded as industrial investment device.
This means the companies with pioneer status do not have to pay tax for a certain period of time, allowing the companies to get established. This tax exemption can be full or partial.
The products or companies suitable for pioneer status are industries or products that do not already exist in the country.
Frontpage September 29, 2020