Provide forex, power, roads and ease of credit facilities, leave tax, MAN tells FG
Barely less than two days the Federal Government said in a bid to ease the burden of the current economic recession on the manufacturing sector, it is planning some form of tax relief for manufacturers, a Lagos based manufacturer, Chief Biodun Ajakaiye has advised the apex government to stop driving Nigerian businesses and manufacturers around without any meaningful focus.
He said “The best thing we need as manufacturers in Nigeria is business enabling environments including access to forex, steady power supply, good roads and one digit credit access for manufacturers.”
“I don’t think that there is any time we told the government that one of our critical challenges include taxation. The only aspect of taxation we hate as manufacturers is not high taxation but its multiplicity. A situation whereby one company is taxed by the federal government, the state and local government and even in some cases, host communities should be stopped and government don’t need any media propaganda to do what is should do.
“We have been crying of forex and some companies are closing up or relocating to other climes and the government is telling us that it will ease some taxes. For all I care, let them increase the taxes and do what we have been telling them to do.
It would be recalled that the Minister of Finance, Mrs. Kemi Adeosun, dropped the hint on Wednesday in Abuja while responding to questions from journalists at the end of the Federation Account Allocation Committee meeting.
She said the tax relief was part of measures by the Federal Government to reduce the negative impact of the foreign exchange crisis on the sector.
Based on the Gross Domestic Product report for the third quarter released by the National Bureau of Statistics, the manufacturing sector’s growth rate was recorded at -2.93 per cent year-on-year.
This is lower by 1.02 percentage points than what was recorded in the second quarter of the year.
The report had blamed the decline in manufacturing activities to the continued drop in the naira to dollar exchange rate, which has made industrial inputs more expensive.
Adeosun said since the sector was one of those badly hit by the economic crisis, the Federal Government would support it with some form of incentives next year.
In addition, she said massive investments in infrastructure would be made to reduce the operating costs of the manufacturing sector.
According to the minister, “It is clear from the figures that the manufacturing sector is the one that is really challenged and the challenge in the sector is clearly that of foreign exchange availability. I think that the sector will benefit from more consistency of the foreign exchange policy.
“On the fiscal side, we are rolling out a number of measures to support the manufacturing sector in terms of tax reliefs and other measures that will allow the balance sheet of the sector to be repaired. They (manufacturers) have taken quite a hit and we will continue to try and support them through it.
“We have a fiscal road map that we will be rolling out and it includes a number of measures around revenue mobilisation, tax reliefs and the fiscal instrument, which will be issued in 2017 to get the economy back to recovery.”