There are strong indications that the federal government is considering granting further tax holiday to investors in the power sector in its bid to help stimulate investment in the sector.
A top government source told THISDAY that the Minister of Finance, Mrs. Kemi Adeosun, recently set up a committee to look into the matter. The outcome of the committee meetings would guide the federal government in decision-making, the source added.
Following the 2013 divestiture of the federal government from the Power Holding Company of Nigeria (PHCN), the successor companies – distribution companies (Discos) and Generation Companies (Gencos), were granted pioneer status, which is likely to expire this year.
Pioneer status takes the form of five-year tax holiday to qualifying industries anywhere in the federation. The grant of pioneer status to an industry is aimed at enabling the industry concerned to make a reasonable level of profit within its formative years. The profit so made is expected to be ploughed back to facilitate expansion and growth of the industry.
“I am aware that the Minister of Finance has set up a committee to review the pioneer status of the power sector firms. So, we are waiting for the outcome, “the source said.
Thisday, January 23, 2017