Manufacturers are requesting a one-year duty waiver on the importation of pharmaceutical raw materials and other raw materials required in the production of essential food items.
This will be in addition to the Value Added Tax exemption that the government granted medical and pharmaceutical products and basic food producers last year.
They made this recommendation in the Manufacturers Association of Nigeria’s CEOs Confidence Index published on Friday.
In view of the impact of COVID-19 on the sector, the manufacturers expressed belief that this intervention as well as other measures will salvage the sector from total collapse.
The country’s Purchasing Managers Index for the manufacturing sector has constantly been below the 50 points benchmark, indicating that the sector is contracting and in a precarious state due to the impact of the outbreak of COVID-19.
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“Introduce fiscal measures by waiving of import duties on Active Pharmaceutical Ingredients (APIs), other raw materials required to manufacture essential products and food related items for one-year,” they stated in the report.
They also suggested that the Federal Government should direct all regulatory agencies working with manufacturers, especially Standards Organizations of Nigeria (SON), National Agency for Food and Drugs Administration & Control (NAFDAC). to reduce their respective administrative charges by 50 per cent
They also advocated for a reversal of the Value Added Tax Rate that was increased from five percent to 7.5 per cent, earlier this year, back to the pre 2020 Finance Act rate.
They also called for reduction in the Personal Income Tax to a flat rate of 10 per cent for one-year effective April 2020.
This, according to the, will improve the disposable income of Nigerian workers, stimulate consumption, promote an upsurge in demand and increase production output.
The asked the government to “direct the Nigeria Customs Service, the Nigerian Ports Authority and other related agencies of Government to treat all requests from Manufacturers expeditiously with great sense of responsibility and understanding of the prevailing situation.
“Prevail on the Central Bank of Nigeria (CBN) to extend its COVID-19 Stimulus packages to manufacturers not covered by existing CBN initiatives.
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The CBN should also grant manufacturers increased access to Foreign Exchange at pre COVID-19 rate to support the importation of raw materials, machines and spares that are not available locally.
“Establish a special bailout fund for the manufacturing sector with set deliverables on the number of jobs to be created, the volume of export, quantum of locally raw materials utilized and projected revenue.
“Extend timelines for filing and paying taxes (including excise duty with a proviso that it should be based on sales and not production) by six months after the economy returns to normalcy.”
They urged the government to grant manufacturers waivers from all demurrages payable between February and July 2020, especially those caused by the lockdown directives of Government and others associated with COVID-19 pandemic.
Manufacturers called on the Bank of Industry and NEXIM to grant manufacturers with existing loan facilities adequate moratorium, reduce interest rate to five per cent and review repayment period after the order of the approved stimulus packages of the CBN.
