Investor Presentaiton
The Country and its
institutions
Business Organisation Labour and Social
and Regulation
Security Regulations
The Nigerian Financial Tax System
Services Industry
Foreign Exchange
Transactions
Investment in Nigeria
Accounting and
Importation of Goods
Exportation of Goods
Auditing Requirements
COVID-19 Economic
and Fiscal Measures
7.5.2
Export Incentives
7.5.2.2
KPMG
The Nigerian Export Promotion Council (NEPC) is the agency vested with
the responsibility of administering non-oil export incentives in Nigeria.
Among other things, the NEPC was established to:
promote the development and diversification of Nigeria's export trade;
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assist in the promotion of export-oriented industries in Nigeria;
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advise government on new export incentives;
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actively promote the implementation of export policies and
programmes;
co-ordinate and monitor export promotion activities in the country;
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collect and disseminate information on products available for export;
provide technical assistance to local exporters in such areas as export
procedure and documentation, transportation, financing, marketing
techniques, quality control, export packaging, costing, pricing and
publicity;
administer grants and other benefits related to export promotion and
development; and
co-operate with other institutions on matters relating to export financing,
export incentives and specialised service to exporters.
Every non-oil exporter is required to register with the NEPC. This will
entitle the exporter to qualify for the available incentives upon satisfying the
prescribed requirements.
The existing incentives are as follows:
7.5.2.1 Duty Drawback/Suspension Scheme (DDSS)
This incentive enables an exporter to:
claim a refund of import duty paid on raw materials and
intermediate products imported for use in the production of
finished goods for export; and
apply for exemption from, or suspension of, import duty prior
to actual importation. When this is done, the exporter is
conferred with the status of a manufacturer-in-bond.
DDSS is administered by the Duty Drawback Committee of the
NEPC.
7.5.2.3
7.5.2.4
Manufacture-in-bond Scheme
This incentive provides for duty-free importation of raw materials
for production of export goods. To access the incentive, a
prospective exporter is required to enter into a bond with an
approved bank, insurance company or Nigerian Export-Import
Bank, guaranteeing that all the end products manufactured by
the company will be exported. The bond will be discharged after
evidence of exportation and repatriation of foreign proceeds has
been produced.
Location within a Free Trade Zone (FTZ)
The benefit of import duty relief can also be obtained if an
exporter is located within an FTZ. Exporters located within an FTZ
are entitled to import thereto, free of customs duty, "any capital
goods, consumer goods, raw materials, components or articles"
intended to be used in relation to an approved activity. Companies
carrying on approved activities in an FTZ are exempt from Federal,
State and Local Government taxes, levies and rates.
Export Expansion Grant (EEG)
The EEG incentive scheme 58 was introduced to facilitate an
increase in export volume and enable exporters to diversify export
products and market coverage. Under the scheme, eligible
exporters are issued with Export Credit Certificates in lieu of
the erstwhile Negotiable Duty Credit Certificates after they have
repatriated in full, proceeds from their export transactions as
confirmed by the CBN.
To qualify for EEG, the exporter must:
1. be registered with the NEPC;
2. be a manufacturer, producer or merchant of Nigerian-made
products for the export market; and
3. have a minimum annual export turnover of #5,000,000 and
evidence of repatriation of export proceeds.
"Companies carrying on approved activities
in an FTZ are exempt from Federal, State and
Local Government taxes, levies and rates."
58 The EEG scheme was suspended in 2013 due to perceived abuse by beneficiaries in claiming the grant. In December 2016, the President,
in his 2017 Budget Speech, announced that EEG would be revived and administered as tax credits. This is in response to industry demand
and alignment with the government's diversification policy.
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