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The Nigeria Industrial Council and Competiveness Advisory Council says it is set to review fiscal arrangements and incentives applicable to the country’s free trade zones (FTZs).
Vice Chairman of the council, who is also the Minister of Industry, Trade and Investment, Okey Enelamah, said the review will increase the incentives available to operators in the zones vis-à-vis the custom territory with the view to ensuring competitiveness of goods produced in the FTZs in the local and export markets.
He said there are many free trade zones at different stages of development in the country. Fourteen are operational, 12 under construction, while the development of 11 others is yet to commence. Also, the ongoing Special Economic Zones project is developing six special economic zones across the geopolitical zones.
“Approved enterprises within FG-owned FTZs are entitled to the following incentives: Exemption from legislative provisions pertaining to taxes, levies, duties and foreign exchange regulations; full repatriation of foreign capital investment with capital appreciation of the investment at any time; up to 100 per cent of foreign ownership allowable; and no import or export licences required for operations; among others,” he said.
According Enelamah, a study by the council has identified some areas that need redress. “For example, manufacturers outside the zones have complained about unfair competition as the tax concessions available to FTZ operators do not take into cognizance the fact that up to 100 per cent of goods produced in the free zones can be sold into the Nigeria customs territory; inadequate definition of value addition and certification; and cash flow advantage to free zone operators who pay duties on constituent raw materials equivalent of finished goods after production and processing, while manufacturers outside the zones pay duties and other relevant levies upfront,” he said.