NITDA to obtain exemption for essential services startups during lockdown

NITDA to obtain exemption for essential services startups during lockdown

Last week, the Nigerian information technology development agency (NITDA), inaugurated a committee consisting of prominent technology experts to help cushion the effects of the lockdown on tech companies.

Featuring the likes of Angel investor, Tomi Davies, Jumia’s Juliet Anammah, and Andela’s Iyin Aboyeji among others, the committee was required to come up with recommendations within 48 hours.

Given the fact that a similar committee had earlier been created by the federal government in 2018, a major talking point was on the actual success of the committee.

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Presently, it appears NITDA wants to properly leverage the knowledge and expertise in the newly convened group.

In line with the committee’s recommendations, NITDA is working on an exemption for companies offering essential services during the lockdown, and it’s doing so with an online form to identify those companies as directed by the Nigerian federal government.

This initiative is important given the confusion that ensued amongst logistics and eCommerce players as a result of the lockdown. A confusion that led to the temporary shut down of a Jumia warehouse last week.

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Besides exemption for tech-enabled companies, the recommendation also includes amongst other initiatives, the reduction of tax burdens on companies and access to affordable internet services.

The issue of taxation, and affordable and reliable internet services, and power, still remain a major issue for most companies and individuals.

Unlike other African countries, no Nigerian network provider has reduced the cost of data, and recent pleas by the minister of communications and digital economy to reduce data and call tariffs have gone unheeded.

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According to a poll conducted by Techpoint, only a handful of respondents have attested to the availability of quality internet services.

Also, the Kenyan government has provided a 100% tax relief for citizens earning up to Ksh24000 ($228) and a reduction in rates for Value-added tax, Companies income tax (CIT) and employee tax.

As the economy comes to terms with the effect of the lockdown, the implementation of such measures (affordable Internet, tax reliefs and power), as suggested by the committee could greatly ensure the continued success of businesses in the country.

Nigerian startups raised $377m in 2019, more than twice what they did in 2018. Find out more when you download the full report.


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