FG’s tax incentives for MSMEs, a boost for economic growth and innovation
By Esther Agbo
The Federal Government has reaffirmed its commitment to empowering micro, small, and medium enterprises (MSMEs) through tax incentives, aimed at spurring growth, fostering innovation, and ensuring the sector’s sustainability.
This reaffirmation was made by the Executive Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, represented by his Special Adviser, Collins Omokaro, during the inaugural MSME Finance Awards, organised by The Economic Forum Series in partnership with Nairametrics and DigiComm Enterprise.
Adedeji highlighted that the Federal Government’s approach focuses on creating an enabling environment for MSMEs by implementing tax reforms that reduce financial burdens. “The Federal Government, through FIRS, has introduced reforms to reduce the financial burden on MSMEs. Small businesses, as classified under the Company Income Tax Act, are exempt from companies income tax and are also exempt from the obligation to collect value-added tax,” he noted.
These measures, he explained, are designed to support MSMEs by simplifying tax compliance and encourage more businesses to transition into the formal economy thereby ensuring that more businesses benefit from tax incentives.
The government is also considering increasing the threshold for tax exemptions to include more MSMEs in its relief initiatives.
The significance of MSMEs in Nigeria’s economy was further underscored at the event. The CEO of Nairametrics, Ugochukwu Obi-Chukwu, remarked, “MSMEs are the backbone of the Nigerian economy, employing over 80 per cent of the workforce and driving innovation across various sectors. It is crucial that we continue to support this sector through policies, incentives, and collaboration between the private and public sectors.”
The MSME Finance Awards also celebrated organisations making impactful contributions to the sector. Access Bank was named MSME Bank of the Year for its financial services channelled to small businesses, while Moniepoint was recognised as the MSME Microfinance Bank of the Year. E-Tranzact and Mastercard also received accolades for their contributions in payment security and MSMEs financial inclusion, respectively.
Moreover, the CEO of The Economic Forum Series, Jude Ndu, praised the awards as a platform to recognise the pivotal role MSMEs play in driving Nigeria’s economy. He emphasised the need for continuous support through financial resources, mentorship, and capacity building.
Furthermore, the Senior Special Assistant to the President on job creation and MSMEs, Temitola Adekunle-Johnson, highlighted how small businesses are leveraging digital platforms like YouTube, WhatsApp and Instagram to grow their customer base and drive revenue.
