May 19, 2024
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Business Economy

MAN, expert flay FG’s reason for excess tax on soft drinks

The Manufacturers Association of Nigeria, MAN and experts have described moves by the Federal Government, FG, to use health reasons as justification to increase excise tax on non-alcoholic drinks as misleading, adding that the reasoning defies all economic logic and Nigeria’s realities.

This is coming barely  two weeks after the Sectoral Group of the MAN raised the alarm over strong indications that the FG is planning additional 20 per cent Ad-Valorem Excise Tax on the Carbonated Soft Drinks (CSD).  They decried what they see as use of a faceless group to push for additional taxes on the beverages sector.

They stated: “The faceless group has been masquerading and trying to use the sugar angle to rationalise an economic virus that may become a pandemic which it intends to unleash on the non-alcoholic beverage industry.

“Spurred by the vociferous campaigns that have been mounted on the issue, government lobbyist are coming up using an emotional but weak health angle to knock the public outcry”, MAN said.

They added, “A coalition, the National Action on Sugar Reduction, recently staged what it termed a peaceful display in Abuja urging the government to increase taxes on sugary drinks and invest the revenue into public health.

According to them: “Citizens’ health is a significant responsibility of all governments, and any action to protect citizens’ health is desirable and should be supported, but the false attribution of sugar-related ailments to a single cause or product is wrong.”

Mr. Teslim Shitta-Bay, a foremost economic analyst, while countering the misleading position put forward by the lobby group argued that, “Nigerians consume 8kg of sugar per person per annum, which is below the prescribed World Health Organisations (WHOs) of 9.1kg per person and is significantly lower than the United Kingdom’s 30kg or the United State of America’s (USA) 46kg per person.”

He added, “Yes, health issue can be connected to economic development but in this case, there is no justification to use health to rationalise simply because the Carbonated Soft Drinks sector has not violated the regulations.

“No doubt, this only made a mess of the health justification been rationalised by the government as this was inadvertently been promoted because users were forced to move from regulated substances which had become a part of their social life at that time to other hard and unregulated drugs due to over regulation”.

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