The Minister of Communications and Digital Economy, Isa Ali Pantami, disclosed this on Sunday, saying the tax reliefs and incentives would help to create millions of jobs in the country.
Pantami said the initiative is part of a number of the proposed strategies made at an interactive forum held on February 22, 2022, when he led a Federal Government delegation on a working visit to the Lagos digital innovation ecosystem, including the Director-General of NITDA, the Executive Vice Chairman of the Nigerian Communications Commission (NCC), the Post Master General and the Managing Director of Galaxy Backbone Plc.
“This will also help to develop innovative solutions to societal problems, and rapidly grow, as well as diversify the Nigerian economy, in line with the National Digital Economy Policy and Strategy for a digital Nigeria,” the statement read.
“Nigeria’s startup ecosystem attracted about 35 per cent (estimated at $1.4 billion) of the over $4 billion raised by African startups, which is the highest raised by any startup ecosystem on the continent.
“The Nigeria Startup Bill was earlier approved by the Federal Executive Council and forwarded to the National Assembly and the process is about 90% complete.
“The approval of the incentives at the council will consolidate the gains recorded for far in the NSB process. The implementation of the National Digital Economy Policy and Strategy emphasises the importance of the innovation and startup ecosystem to the development of an indigenous digital economy.”
Pantami added the federal government would continue to position Nigeria to develop the tech ecosystem to transform Nigeria into a country with a sustainable and thriving digital economy.
The Federal Executive Council (FEC) had, last week, approved a plan to incentivise and further harness Nigeria’s digital innovation and entrepreneurship ecosystem. This followed the presentation of a memo by Pantami.
According to the Ministry of Communications and Digital Economy, the approval will help develop innovative solutions to societal problems, rapidly grow, and diversify the Nigerian economy, in line with the National Digital Economy Policy and Strategy (NDEPS) for a Digital Nigeria.
The implementation of the NDEPS emphasises the importance of the innovation and startup ecosystem to the development of an indigenous digital economy.
The Nigeria Startup Bill (NSB) was earlier approved by the FEC and forwarded to the National Assembly and the process is about 90% complete.
The approval of the incentives at the FEC will consolidate the gains recorded for far in the NSB process.
The FEC approved the following recommendations, in line with the Executive Order 003 and Presidential Order 005:
i. that the Federal Ministry of Finance, Budget and National Planning and the Nigerian Investment Promotion Commission (NIPC) should prioritise the granting of Tax Reliefs and other Incentives such as the Pioneer Status Incentive (PSI) Scheme to the technology and innovation ecosystem;
ii. That the Nigerian Copyright Commission, the Trademarks Registry, and the Patents and Designs Registry should work with the National Information Technology Development Agency (NITDA) in developing an Intellectual Property (IP) framework for the technology and innovation ecosystem within two (2) months and;
iii. That the Bureau of Public Procurement (BPP) should work with NITDA to develop a framework that will ensure the involvement of technology innovation startups in government procurement processes to encourage ideation, innovation and design of solutions to solve development challenges within two (2) months.
What the tax relief does
Startups have the potential to play a major role in the growth of developing countries, especially because of their ability to reduce unemployment, create wealth by attracting local and foreign investments, and provide practical solutions to local problems.
Tax relief will ease operational costs which include product development and upgrade and possible increased wages and salaries
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