MAN applauds Abuja for suspending tax, says it encourages manufacturers
By Jeph Ajobaju, Chief Copy Editor
Abuja’s decision to shelf excise duty on alcohol, non-alcoholic beverages and tobacco (dubbed sugar tax) has been applauded by the Manufacturers Association of Nigeria (MAN) which had complained the levy would cut production and jobs.
MAN praised the authorities for allowing the 2022-2024 Federal Government Sectoral Roadmap to run its full course.
The excise duty was part of a new policy introduced in the Finance Bill signed into law by President Muhammadu Buhari in December 2021 alongside the 2022 Appropriation Bill.
Finance Minister Zainab Ahmed argued the sugar tax was introduced to raise excise duties and revenues for health-related and other critical expenditures in line with the 2022 budget priorities.
The bill required manufacturers to pay a N10 tax per litre of all non-alcoholic, carbonated, and sweetened beverages.
But MAN warned at the time such a levy would be counter-productive and urged Abuja to devise other means of generating revenue rather than inadvertently stifling the productive sector which is already struggling.
A statement issued on the U-turn by MAN Director General Segun Ajayi-Kadir described it as a relief to its members across the country.
“The Association is gladdened by the assurances of the Honourable Minister, Hajiya Zainab Ahmed that the 2023 Fiscal Policy Guidelines and the reconsideration of the Finance Act 2023 have been concluded and would be released immediately,” Ajayi-Kadir said.
________________________________________________________________________
Related articles:
MAN warns Sugar Tax will slash output, revenue
Nigeria’s excessive taxation driving food and beverage factories to neighbouring countries
Bakers warn bread price will double – on higher costs
________________________________________________________________________
Encouragement to manufacturers
“In specific terms, she assured that the guidelines would not include the proposed increase in excise duty on Beer, Wines and Spirits, Tobacco and Non-Alcoholic Beverages in 2023, but rather allow the excise regime to run its full course from 2022 to 2024 as programmed in the Road Map by the Federal Government in 2022,” the statement added, per The PUNCH.
“This comes as a huge relief to our members across the federation and will signpost the administration’s support for the sustenance of manufacturing in Nigeria on this score.”
“Furthermore, MAN received the understanding of government on the introduction of 0.5% import surcharge, which is meant to fulfil Nigeria’s obligations to the continental agreement in the implementation of Africa Continental Free Trade Area (AfCFTA) agreement, as well as the promised intervention on resolving the logjams in the interpretation of the Tin Plate, HS Code 7210. 12.00.00 with the Nigeria Customs Service.
“From the foregoing, the Association views the federal government’s move as one that will encourage our members who are currently struggling with unprecedented low sales, forex squeeze, inadequate electricity supply and multiple taxes and levies from the three tiers of government.
“This move will reassure members of the administration’s respect for stakeholder’s engagement and the usefulness of public-private sector dialogue.”
MAN said it looks forward to improved performance of the manufacturing sector and the economy as it continues to engage the government meaningfully on national economic growth.