Pioneer Status In Nigeria

The Pioneer Status incentive (PSI) is one of the available tax incentives in Nigeria aimed at attracting investment into crucial sectors of the Nigerian economy. The pioneer  status incentive was established by the Industrial Development  (Income Tax Relief) Act, No 22 of 1971 and is a tax holiday that grants qualifying industries and products relief from payment of corporate income tax for an initial period of three years, extendable for one of two additional year

These are the industries and their sub-sectors that qualify for PSI. Companies that engage in any of the industries below may apply for PSI:

Agriculture
  • Crop Production (All crops)
  • Livestock (Cattle, swine/pigs, sheep. goat, and poultry)
  • Fishing (All fish, shell, and aquaculture)
  • Forestry (Latex and gum arabic)
Mining and Quarrying
  • Mining of coal ( Coal)
  • Mining of metal ores (Lead, Zinc, Iron Ore, and gold)
  • Quarrying and Mining of other minerals ( limestone, barite, bitumen, and bentonite)
Manufacturing
  • Refining of crude oil and gas production (oil-based lubricating oils/grease; hydraulic/engine oil, gear oil, low power oil, brake fluid. Motor fuel: gasoline kerosene and diesel. Fuel. Aviation fuel. Products for road covering: Asphalt )
  • Manufacture of food and beverage products 
  • Manufacturing of textiles and leather
  • Manufacture of pulp, paper products
  • Manufacture of chemical and pharmaceutical products 
  • Manufacture of non-metallic products (manufacture of glass and glass products)
  • manufacture of non-metallic products (manufacture of refractory products)
  • Manufacture of rubber  and plastic products
  • Manufacture of electoral equipment and electronics
  • Manufacture of basic metals, iron, and steel
Electricity and gas supply
  • Electricity and gas supply (electric power generation, transmission and distribution, manufacture of gas, and gas distribution)
Waste Management
Construction
Trade
  • E-commerce services (E-commerce services with sales done predominantly or exclusively online)
Information and communication
Professional services
  • Photographic activities (Photograph for tourism purposes and aerie photograph

see the full list here https://nipc.gov.ng/ViewerJS/#../wp-content/uploads/2019/01/Gazetted-List-of-Pioneer-Industries-and-Products.pdf

Benefits of Pioneer Status

The PSI grants an income tax “holiday” of up to five years (three years initially and renewable for an additional two years) to entities that meet the criteria. In addition, pioneer companies may enjoy other benefits including an exemption from withholding tax on dividends paid out of business profit

The company must be engaged in the pioneer industry, must have physical long-term assets worth over N100 MILLION, and must be able to show the positive impact its business will have on the Nigerian economy.

The application will be by a letter to the Nigerian investment promotion commission (NIPC) in the first year of production, attaching legal and business documents like incorporation documents, regulatory permits, business plan, etc.

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