Manufacturers Association of Nigeria (MAN) has lauded the Federal Government’s decision to halt the proposed increase in excise duty on alcoholic, non-alcoholic beverages, tobacco and to allow the 2022-2024 sectoral roadmap run its full course.
The Director General of MAN, Segun Ajayi-Kadir, gave the commendation on behalf of the association.
He said the Finance Minister, Zainab Ahmed, has assured the association that the 2023 Fiscal Policy Guidelines and the reconsideration of the Finance Act 2023 have been concluded.
According to Ahmed, “the guidelines would not include Excise duty increase on Beer, Wines and Spirits, Tobacco and Non-Alcoholic Beverage in 2023, rather the Excise regime will run its full course from 2022 to 2024″.
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The association said introducing the excise duty of ₦10 per litre on all non-alcoholic, carbonated and sweetened beverages in Nigeria was a major setback for the productive sector in 2022.
The Sugar Tax
The charge was part of a new policy introduced in the Finance Act, signed into law by President Muhammadu Buhari on December 31, 2021, alongside the 2022 Appropriation Bill.
According to her, the new sugar tax was introduced to raise excise duties and revenues for health-related and other critical expenditures in line with the 2022 budget priorities.
Although the revenue was projected at ₦81 billion from 2021-2025, the potential loss to government in other forms of taxes and revenue cut leaves much to be desired.
The MAN, through a series of advocacy channels warned that a new tax imposed on carbonated drinks and others would be counter-productive.
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Also, it advises the government to devise other means of generating revenue rather than inadvertently stifling the productive sector which is already struggling.
Still grappling with a recent increase in line with a three-year roadmap, the proposed increase in excise duty on beer, wines and spirits, tobacco and non-alcoholic beverages in 2023 became another nightmare to a sector gasping for survival amid evident setbacks occasioned by Naira scarcity, forex crunch, infrastructure deficit but to mention a few.
