The Federal Government has confirmed that 149 companies currently enjoying pioneer status incentives will retain their tax holidays for at least two more years, even as Nigeria prepares to implement a new tax regime from January 2026. The Nigerian Investment Promotion Commission (NIPC) disclosed the transitional arrangement during a media briefing in Abuja, noting that existing beneficiaries would be protected under provisions designed to ensure a smooth shift to the new framework.
Data from the commission showed that the Pioneer Status Incentive (PSI) has attracted total capital investments of about N8.7 trillion since its inception in 2017, while generating 58,897 direct jobs, primarily in manufacturing and concentrated in Lagos State. Between 2017 and the second quarter of 2025, the commission received 693 applications, of which 304 were granted, 64 denied, and one certificate was cancelled, leaving 149 companies as current beneficiaries.
The Chairman of the Presidential Tax Reform Committee, Taiwo Oyedele, explained that the decision to maintain tax holidays for existing firms aims to protect investor confidence and facilitate an orderly transition to the Economic Development Incentive under the new tax law. Under the PSI, companies enjoy full corporate income tax relief for three years, extendable by two years, before a gradual phase-out begins.
Officials noted that while the PSI has been effective in stimulating industrial investment in sectors not previously established in Nigeria, it has also been costly, with estimated annual revenue losses of N8 trillion due to tax waivers. Going forward, the PSI will evolve into the Economic Development Incentive, a tax credit-based system that allows companies to pay taxes while benefiting from credits tied to capital expenditure thresholds. Some firms could enjoy reliefs and credits for up to 15 years, depending on reinvestment performance.
NIPC Executive Secretary Aisha Rimi, represented by the Director of Strategic Services, Abubakar Yerima, highlighted the agency’s efforts to bolster investment inflows, noting that the commission facilitated over $10 billion in commitments in 2025. Capital importation rose to $5.2 billion in the first quarter of 2025, up from $3.4 billion in the same period of 2024, with total inflows for the first half reaching $10.23 billion. Investments were primarily in manufacturing, ICT, agro-processing, renewable energy, and services, while the commission also supported the incorporation of nearly 100 companies, processed investor inquiries, approved expatriate quotas, and strengthened its One-Stop Investment Centre to improve ease of doing business.
Rimi further revealed that in the second quarter of 2025, 17 companies were granted pioneer status, mobilising about $809.57 million in capital and creating over 3,000 direct jobs, with additional approvals in the third quarter generating more than 2,400 jobs.
The announcement received praise from industry observers, including the Chairman of the Commerce and Industry Correspondents Association of Nigeria, Ifeanyi Onuba, who emphasised that accurate reporting of such initiatives is critical for sustaining investor confidence and driving economic growth.
