The Federal Government has revealed that it has started the implementation of a N10 per litre sugar tax on carbonated sugar drinks and beverages which they say will help combat Non-communicable Diseases.
The policy was introduced in the Finance Act which was signed into law by President Muhammadu Buhari on December 31, 2021, alongside the 2022 Appropriation Bill.
This was disclosed by Mr Dennis Ituma, Chief Superintendent of Customs, Department of Excise, Free Trade Zone and Industrial Incentives, in an interactive session at a Policy Breakfast Meeting in Abuja on Thursday organised by the National Action on Sugar Reduction to proffer ways to implement tax and other interventions to reduce SSBs consumption in Nigeria.
What they are saying
The Customs boss said the services had commenced taxing companies that produced Sugar-Sweetened Beverages on the 1st of June, 2023.
“The N10 per litre of Sugar-Sweetened Beverages has been implemented on June 1, by July 21, all excise duties must have been collected and paid into the federation account.
“It should interest you that taxation on SSBs was a policy of the Federal Government in 1984 but was stopped in January 2009.
“Previously both SSBs, alcoholic drinks and tobacco were all taxed until 2009 when SSBs was removed from taxable beverages.
“Only alcoholic drinks and tobacco generates N414 billion, SSBs will further increase the revenue generated from drinks,” he said.
He added that the Customs Service designates resident customs officers to all factories producing SSBs who take the measurements of all daily productions.
Mr Musa Umar, a representative of the Federal Ministry of Finance Budget and National Planning said it was important to get those at the high level of policy-making involved in the advocacy to get their commitment to channel the funds from the tax to health issues that resulted out of the excessive consumption of SSBs.
What you should know
- Nairametrics reported in January that the Federal Government announced the introduction of excise duty of N10 per litre on all non-alcoholic, carbonated and sweetened beverages in the country.
- The charge is part of a new policy introduced in the Finance Act which was signed into law by President Muhammadu Buhari on December 31, 2021, alongside the 2022 Appropriation Bill.
- Minister of Finance, Budget and National Planning, Zainab Ahmed, revealed this during the public presentation and breakdown of the 2022 budget held on Wednesday, January 5, 2021, in Abuja.
- The Manufacturers Association of Nigeria also warned the FG to halt the planned N10 naira per litre tax on sweetened and non-alcoholic beverages (Sugar Tax). They said the revenue aspirations of the government in introducing this excise may not be justified in the long run.