Yemisi Izuora
The Manufacturers Association of Nigeria (MAN), has said it will support Nigeria’s efforts in harmonizing tax policy just as it said continuous engagement is necessary to ensure clarity in areas of misconceptions.
The Director-General (DG) of MAN, Mr Segun Ajayi-Kadir, made the remarks when the Association engaged the Presidential Committee on Fiscal Policy and Tax Reforms on Thursday to explain benefits and address concerns over new tax laws.
The DG, commended manufacturers for openly communicating their concerns and articulating their expectations regarding the impact of the tax reforms on the sector.
He pledged continued engagement with the government to ensure the advancement and sustainability of the manufacturing sector.
The engagement, held in Lagos, aimed to clarify misconceptions surrounding implementation and implications for manufacturers across different sectors.
The forum, with the theme ‘From Legislative Assembly to Factory Floor’, focused on how the new tax laws affect Nigerian manufacturers’ operations.
Committee chairman, Mr Taiwo Oyedele, said the reforms were designed to promote equity, competitiveness and simplicity within Nigeria’s fiscal framework.
Oyedele said manufacturers would benefit from input VAT claims on assets and services, revised income bands, exemption thresholds, reliefs and allowances.
“Other measures include a tax ombudsman and withholding tax exemptions for manufacturers and small businesses,” he said.
He said the Economic Development Incentive Scheme prioritised agriculture, food production, energy, mining, health, textiles and utility projects.
“Others include ICT, creative industries, chemicals, building materials, steel, transportation, machinery and environmental services,” Oyedele added.
Oyedele said VAT exemptions covered locally manufactured sanitary towels, assistive devices and disability-related products.
“Zero-rated supplies include fertilisers, agricultural chemicals, veterinary medicines and animal feeds,” he said.
He noted VAT on petroleum products, renewable energy equipment, CNG and LPG might be suspended by the finance minister’s order.
Oyedele said input VAT deductions would apply only to taxable supplies, while non-taxable portions would remain non-deductible.
He added that research and development expenses were deductible, capped at five per cent of annual turnover.
Oyedele acknowledged manufacturers’ concerns over multiple taxes, high burdens and VAT compliance challenges.
“Taxing poverty and multiple levies distorted the system. These reforms aim to fix that and support manufacturing,” he said.
Other issues raised, included VAT compliance challenges, taxation of raw materials, subnational tax practices, removal of income tax exemptions for exporters and discrepancies in tax laws.
Allaying these concerns, Oyedele reaffirmed the Federal Government’s recognition of manufacturing as a critical driver of job creation, export growth and overall economic development.
He said the government’s reforms, including tax reforms, were expected to have a noticeable positive impact on the manufacturing sector.
He urged manufacturers to keep proper records and rely on credible information to benefit from the reforms.
“Manufacturers must keep proper records to understand what they can claim and position themselves to take advantage of the opportunities embedded in the tax reforms.
“I want you to know that the government is committed to addressing tax issues in the country,” he said.