The National Association of Nigerian Students (NANS) in the South-West zone has rejected the Federal Government’s (FG) scheme to introduce ₦10 per litre tax on soft (carbonated) drinks.
Olatunji Adegboye, the Coordinator of NANS in South-West in a statement on Monday said that imposing a tax on soft drinks is not a way diabetes and other health-related ailment associated with consumption of sweetened beverages could be stopped.
FG had announced the increased taxes as a way of discouraging over-consumption of sugar, checking obesity, and also generating more money to fund the 2022 budget.
NANS said the Presidency should look at how to reduce the cost of governance to free more funds for development.
The statement partly read, “Imposition of additional duty on carbonated drinks is anti-people, anti-democratic, and retrogressive. It contradicts the law of humanity and the law of God. It is not in any way constant with the spirit of fairness and starkly contravenes what President Muhammadu Buhari promised Nigerians while campaigning for our votes.
“For an administration whose major source of finance is foreign loans, one would expect those redundant appointees and underperforming ministers who have done nothing but eating national resources be removed so as to salvage precious billions of naira from further waste.
“Holistic means to reduce the cost of governance should also be proffered, adopted and implemented.
“The above will not only save the country trillions of Naira but also reinvigorate our economy and democracy.”
What did other groups say?
BizWatch Nigeria recalls that the Nigeria Labour Congress (NLC) also rejected FG’s plan to increase taxes on non-alcoholic and carbonated drinks.
The Lagos Chamber of Commerce and Industry (LCCI) had urged FG to protect domestic manufacturers from unfair competition by foreign companies in the face of the high cost of production that will be triggered by the new excise duty on carbonated drinks. LCCI also advised FG to use the revenue generated from the excise tax to improve the country’s grossly inadequate health infrastructure.
The Manufacturers Association of Nigeria (MAN) warned that a new tax imposed on carbonated drinks would be futile. MAN authorized a report detailing the effects of reintroducing excise duty on carbonated drinks and warned that it would be counterproductive and lead to revenue loss for the government.
The report, titled ‘key considerations against excise on non-alcoholic beverages’, reveals that the government might collect ₦81 billion revenue from excise duty on carbonated drinks between 2022 and 2025, but lose ₦197 billion within the same period from other taxes, such as Value Added Tax and Company Income Tax from the manufacturers of soft drinks.