The Lagos Chamber of Commerce and Industry (LCCI) has said  the Nigeria Start-up  Act, 2022 supports entrepreneurship, sound regulation and an efficient tax system for a digital economy.

President of the chamber, Dr Michael Olawale-Cole, made the remark at a seminar organised by the Lagos Chamber of Commerce and Industry (LCCI) Information and Communications Technology (ICT) Group in collaboration with Professional Practice Group seminar themed: “Insights into the Nigeria Start-up Act, 2022,” in Lagos.

The Start-Up Act was signed into law by President Muhammadu Buhari on October 19 to harness the potential of the country’s digital economy through co-created regulations.

Olawale-Cole noted that the theme of the seminar was apt considering  that the Act supports the tech-start-up ecosystem in Nigeria and seeing that the Nigerian ICT sector was one of the fastest growing sectors in the economy.

He said the ICT sector remained the only sector with consistent positive growth before and after the coronavirus pandemic, with a growth of 10.53 per cent in the third quarter and a 15.4 per cent contribution to Gross Domestic Product.

The LCCI boss added that Nigeria recorded over 3,300 start-ups in 2020, the highest in Africa compared to South Africa (660 start-ups) and Kenya (600 start-ups).

He attributed the strong growth recorded by the sector to the innovative activities of ICT operators and policies introduced by government including the National Digital Economy Policy and Strategy (2020-2030), E-Government Masterplan and others.

On his part, Ayodele Kusamotu, Chairman, Kusamotu and Kusamotu (Green Fish Chamber) urged technology startup businesses to take advantage of the newly unveiled Startup Act for growth and sustainability.

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Kusamotu said some of the incentives under the Act included assistance for startups within the pioneer scheme industries to apply for tax relief.

Others, he said, were the five per cent withholding tax on non resident companies providing technical services to a labelled startup and full deduction on research and development expenses in Nigeria. Kusamotu added that the startups were also exempted from Industrial Trust Fund contributions where it provided in-house training to its employees for the period it was designated as start-up.

“Also, export incentives, access to loans, credit guarantee scheme, investment tax credit equivalent to 30 per cent of the investment in the labelled startup provided, shall be applied on any gains on investment which are subject to tax.

“Additional, capital gains tax shall not be charged on gains that accrue from the disposal of assets by an angel investor, venture capitalist, private equity fund, accelerators or incubators with respect to a labelled startup, provided the assets have been held in Nigeria for a minimum of 24 months.

Kusamotu, however, stressed the need for governance structure for the startup consultative forum in the council.

He added that directive on amount of seed fund to be invested in research and development must be spelt out and called for rules to back up the law to support the implementation of the Act.

Other speakers at the event were Charles Emembolu, Co founder and director,  Roar Nigeria Hub, who gave his start up experience. 

Samuel Jackson, Lonadek Global Service also gave his start-up experience.