Senate grants tax holiday to trade zone

he Senate yesterday passed the new Oil and Gas Export Free Zone Authority law granting tax holiday to operators in Nigeria.

Oil and gas free zone is located at Onne/Ikpokiri in Rivers State. Lawmakers passed a bill which altered the Oil and Gas Export Free Zone Authority Act Cap 05, LFN 2011, together with a clause providing for the appointment of a Board and Chairman and which must reflect federal character as provided in the 1999 Constitution and subject to approval by the senate.

Senator Odion Ugbesia, who chaired the Joint Senate Committee on Trade and Establishment and Public Service, told his colleagues that, “investors enjoy as incentive and encouragement for investment and this amendment provides just that.”

According to him objectives of the new amendment are, socioeconomic development of the immediate community where the free zones and sub-zones are located, contributing to the growth of the country’s Gross Domestic Product, domestication of business activities in the oil and gas sector and employment generation or job creation.

Senator Ugbesia argued that tax holiday for the operators is in line with best global practices and that Nigeria should be no exception.

An amendment of Section 8 sub section (3) (4) provides that an approved free zone enterprise or developer or operator shall be entitled to tax holiday including but not limited to value added tax (VAT), capital gains tax, companies in one tax and industrial training fund, levies, duties and rates wherever applicable.