As investors intensify their search for more business-friendly climate to reduce operational costs and increase profit margin, a good number of investors are setting up in Edo State to cash in on the unique incentive on offer.
Checks revealed that Edo State is the first sub-national government to grant tax credit to investors, a unique incentive that experts said is capable of changing the economic fortunes of the State.
A tax credit, according to Investopedia “is an amount of money that taxpayers can subtract directly from the taxes they owe” and sources close to the Edo State government explained that the initiative is part of the drastic economic strategies designed to re-engineer the wheel of economic development and growth of the State.
According to experts, a tax credit is a new innovative project financing method to get the private sector to invest and enhance infrastructural development in a State or country.
It is a scheme targeted at revolutionizing the government’s approach to financing infrastructure to support development.
It allows private sector players to invest in infrastructure in return for tax credits. The Federal and state governments may grant tax credits to encourage investment in critical sectors of the economy.
Tax credit is used to achieve accelerated growth, create jobs, increase economic activities and also improve the standard of living of a State. It is used to sustain efforts to ensure a peaceful and conducive atmosphere for businesses to thrive, to make the State a preferred destination for investors.
Specifically, the initiative by the Edo State Government has attracted the Saro Group of Companies which has invested not less than N24bn in an integrated farm factory project in Edo State, in a concerted effort to boost local production of raw materials for use in the manufacturing sector, especially the food and beverages sub-sector.
According to the Chief Executive Officer of Saro Group of Companies, Mr. Rasheed Sarumi, “The integrated agricultural project is a joint venture between Saro Africa and Mohinani Group, under the Green Hills Agric Projects.”
Sarumi commended the Obaseki-led government for creating a business-friendly environment, noting that the factory will be commissioned in the first quarter of 2023.
The Saro Group is a beneficiary of the State’s tax credit scheme which has influenced the construction of a 3KM road in Ologbo, in Ikpoba Okha Local Government Area of the State.
The integrated agricultural project is an important project because it uses raw materials from the State and will be employing hundreds of people to grow cassava and also work in the factory to process the output, which is ethanol.
In addition, the Saro Group has also commenced the development of a 10,000 hectare oil palm plantation and set up a 30 hectare nursery, with plans of planting 400,000 nuts in Evboesi Community in Orhionmwon Local Government Area of Edo State. This is a community that has not witnessed investments of such scale since its creation.
The project has received encomiums from the host community. The Ohen-Osa of Evboesi, Chief Billy Akongie, while hailing the Governor’s investment drive to create employment for the teeming youths, noted, “Obaseki is our Son. We are pleased and at the same time pleasantly surprised with what Saro is doing in Evboesi; our youths have been gainfully employed in their farms and we are very happy about the 500 KVA Transformer that Saro Oil Palm gave to us.”
This initiative by the Obaseki administration will not only boost economic activities in the State, but also attract foreign investment that will in turn create job opportunities, promote faster and sustainable growth, and improve the standard of living of residents.