The House of Representatives, in exercise of its powers under the Nigerian Constitution, has set up an ad-hoc committee (the Committee) to investigate perceived abuse of pioneer status tax incentive by companies operating in Nigeria. In this regard, the Committee recently issued a public notice inviting Nigerian Investment Promotion Commission (NIPC), Federal Inland Revenue Service (FIRS), selected companies, and other stakeholders involved in the pioneer status grant process to an investigative hearing slated for 2 June 2017 in Abuja.
All entities listed in the notice, as well as other interested stakeholders are required to submit a memorandum to the Committee by 22 May 2017, ahead of the hearing.
As you may know, the Industrial Development Income Tax Relief Act (IDTRA) is the enabling Act for granting pioneer status in Nigeria, while the NIPC regulates and monitors the process. Based on IDITRA, applicants conferred with pioneer status enjoy income tax holiday for an initial period of 3 years with a possibility of an extension for another 2-year period, with the aim of encouraging investment in selected industries.
The public notice issued by the Committee has however left many questions unanswered such as:
· Criteria for selecting the listed entities, as not all entities which have enjoyed pioneer status were included.
· Specific information regarding content or format of the memoranda.
· Proposed outcome of the investigation exercise.
Find a copy of the notice here
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