Maritime Report

September 24, 2020

Transportation, finance ministries push tax holiday for maritime sector

Badagry Deep Seaport

By Godfrey Bivbere

MINISTRIES of Transportation and Finance are working at rolling out tax incentives for operators in the maritime sector to spur growth in the industry.
The move which is in response to the impact of Coronavirus (COVID-19) pandemic, is the Federal Government’s efforts to  stimulate investment and boost activities in the maritime industry and other sectors of the nation’s economy.

READ ALSODBN: Experts advocate more capacity building for increased lending to SMEs By Princewill Ekwujuru

Director-General of the Nigerian Maritime Administration and Safety Agency, NIMASA, Bashir  Jamoh, who disclosed this in Abuja during a visit to Minister of Finance, Hajiya Zainab Ahmed, said  that the minister of Federal Ministry of Transportation is seeking a package of tax incentives for the maritime sector.
The NIMASA boss told the finance minister that the minister of transportation, Rotimi Chibuike Amaechi, is committed to ensuring the growth of the maritime industry in Nigeria.
A statement signed by Head, Corporate Communications of NIMASA, Philip Kyanet,  noted that the NIMASA helmsman  said many governments around the globe had introduced massive tax reduction or elimination to spur activities in key sectors and rev up their economies during the Coronavirus pandemic.
Jamoh stated: “The maritime sector is critical in the growth and development of transportation and, by extension, international trade in the country. Thus, the need for Federal Government-oriented programmes and stimulus packages to deliver a response that catalyses a sustainable economic development cannot be overemphasised.”
Jamoh said the proposed incentives included zero import duty for brand new vessels imported by Nigerians or Nigerian shipping companies for use in foreign or domestic trade; 0.5 per cent only import duty for vessels aged between one and five years intended for use in foreign or domestic trade; and one per cent only import duty for vessels aged between five and eight years intended for use in foreign or domestic trade.
There was also a proposal for zero import duty for parts or components imported by Nigerian shipyards for local shipbuilding, which will be for an initial period of four years after which it can be reviewed by government. All these are expected to give the sector the vibrancy it needs for growth.
He said the incentives were being proposed because of the importance of the Nigerian maritime sector to the entire sub-Saharan African region.
He emphasised that Nigeria accounted for more than 65 per cent of the entire shipping trade of the sub-African continent. Nigeria is also the largest producer and exporter of oil and gas in the continent and Africa’s largest economy.