The Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, on Monday hinted that the Federal Government intended to reduce the cost of tax expenditures for corporates and ensure that tax incentives have positive impacts on their operations as a strategic step towards growing the nation’s economy.
The minister disclosed this while discussing the recent approval of incorporating an Incentive Monitoring and Evaluation Platform (IMEP) into the existing Import Duty Exemption Certificate (IDEC) process.
According to him, the IDEC automation, which was introduced as from 1st March, 2020, is a fiscal incentive by the Federal Government under the Ministry of Finance to boost performances of key sectors of the economy by exempting operators from paying import duty and all other statutory customs charges respectively.
He said: “This is to provide the Federal Ministry of Finance with a robust automated tool for more effective Monitoring and Evaluation (M &E) measurement of the impact of all customs duty exemptions issued by the Ministry to government entities, companies, non- governmental organisations (NGOs) and international organisations.”
The minister clarified that the system was set up to block and limit access to those who did not qualify, enforce adherence to fiscal policies, and offer a detailed analysis of how tax incentives affect the economy.
He said that this approach would also help in avoiding the misuse of tax expenditures, enhancing the economic benefits derived from fiscal incentives, and improving the direct evaluation of the impact of tax incentives on the economy.
Making further clarification on the key features of the IMEP, Edun listed some of its critical aspects as including Duty waiver claw back mechanism for issuance of demand notices to defaulters which would prevent misuse of issued incentive, E-report generation, A centralised database, Factory geo-location tagging, Industry qualification status validation, and Inter- ministries department and agency (MDA) integration.
Edun also disclosed that a webinar would be held on Tuesday, April 23, to explain the updated IDEC process to the public.
