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Report calls for stronger incentives for MSMEs in states

By Ngozi Egenuka
23 December 2021   |   2:58 am
Consultant, Lexworth Legal Partners, Yetunde Olasope, has said that the creation of incentives for micro small and medium enterprises (MSMEs) in state laws would strengthen

Consultant, Lexworth Legal Partners, Yetunde Olasope, has said that the creation of incentives for micro small and medium enterprises (MSMEs) in state laws would strengthen the regulatory landscape and improve Lagos’ business environment.

This is stated in a report by the firm, which also revealed that there is a gap between MSMEs and agencies that are expected to provide support to them.

This was contained in the presentation of findings and key recommendations in a report on the Mapping and Analysis of Existing Regulations, Laws, Policies and Institutions for MSME develop­ment and employment promotion in Lagos state. The Office of Sustainable Development Goals and Investment (OSDG&I) did the presentation in partnership with Gesellschaft für Internationale Zusammenarbeit (GIZ) in Lagos.

The report harped on the urgent need for ministries, departments and agencies (MDAs) to improve their information dissemination to business owners, using technology to achieve the required level of reach.

The report recommended aggressive dissemination of information and awareness campaigns utilising statistics and data gathering as a tool for development and policy direction.

According to Olasope, who is also the Founding Partner, Lexworth, the research showed that government activities have not improved businesses of MSMEs as 49 per cent of participants said, “regulators are unfriendly.”

On business registrations, the report stated that the query system at CAC has to be improved to allow responses to queries by the commission.

“As it is presently, the user of the portal has to comply with the stipulations of the query even if not in agreement with the rationale of such a query,” she explained.

The report also called for a repeal of Lagos state partnership law to the extent of its inconsistency with or duplication of roles.

On tax administration, the activities of the joint revenue Committee must be accelerated to address the multiplicity of taxes at the different levels of government within the state.

The need to digitise the entire tax system and close the information gap was also emphasised.

From regulators’ perspective, some challenges faced include lack of infrastructure to enforce regulations, delayed judicial process, the existence of obsolete laws and others. While business owners noted their challenges as access to finance, multiple taxations, high and unstable foreign exchange among others.

Special Adviser to the Governor on SDG&I, Solape Hammond, explained that the capacity resident in the MSME, especially in wealth creation, should not be ignored.

She said: “It is, therefore, imperative to harmonise policies towards encouraging the growth of local businesses to directly alleviate poverty by increasing income levels of small and medium traders, which will translate to the creation of more jobs.”