The federal government says it will begin a review of various incentives and waivers granted to businesses.
The Minister of Finance, Mrs. Zainab Ahmed, who disclosed this at the Public Presentation of Draft 2020-2022 Medium Term Expenditure Framework on Tuesday in Abuja said that the arrangement had led to great revenue loss for the government.
Over the years, financial experts have criticised the granting of waivers and incentives to investors saying it was not a criteria for investments’ growth and development.
According to the Mrs. Ahmed, the review will start with the review is to commence with the pioneer status certificate issuance process.
While acknowledging that the move will not.be an overnight thing, the Minister said any decision that the government takes on issues of incentives to businesses will be determined on their job creation ability.
She said: “There must be a period that should be allowed for the business to exit before new conditions are imposed.
“Government is currently reviewing the quantum of waivers to see which can be put back or removed to reduce the cost of government. Despite the cost, to encourage businesses and investors and make Nigeria competitive, some of the incentives are essential.”
In 2014, former minister of finance, Ngizi Okonjo-Iweala said that a total of N55.97 billion, made up of N23.422 billion (import duty exemptions) and N33.543 billion (waivers), was lost in 2011, while about N55.345 billion, consisting N46.789 billion (exemptions) and N8.556billion (waivers) was lost in 2012. She added that a total of N59.417 billion, composed of N33.319 billion (exemptions) and N26.097 billion (waivers), was lost in 2013.
Responding to a question on the bailout fund, Mrs. Ahmed who also doubles as the Budget and National Planning Minister explained that the N650 billion given to states was a conditional budget support to states to enable them meet their obligation.