Reject New Sugar Bill, CPPE urges HoRs

Centre for the Promotion of Private Enterprise (CPPE) has called on members of the nation’s House of Representatives to reject the new Sugar Beverage Tax Bill, recently passed by the upper legislative chamber, the Senate, arguing that the nation’s economy presently needs relief and not more burdens.

The call is coming on the heels of the Senate passage of an amendment to the Customs and Excise Tariff Act, replacing the fixed N10/litre Sugar Tax with a percentage-based levy, calculated on the retail price of Sugar Sweetened Beverages (SSBs).

Expressing shock and deep concern at the Senate’s action, CPPE, in a statement issued by its Director General, Dr. Muda Yusuf, on Sunday, argued that the bill seeks to impose an additional layer of taxation on non-alcoholic beverage manufacturers at a time government policy is focused on easing the cost of doing business and revitalising manufacturing.

Describing the bill as ill-timed, insensitive to prevailing economic realities and inconsistent with federal government’s commitment to reducing tax burdens on businesses, the Centre noted that coming up with such bill would, without doubt, aggravate the cost pressures across manufacturing value chain.

It further argued that imposition of an additional excise tax on non-alcoholic beverages would further erode industrial competitiveness and weaken investment prospects, especially at a time manufacturers are grappling with elevated energy costs, high interest rates, exchange rate pressures, logistics challenges, weak consumer purchasing power, and multiple taxes and levies.

The Centre noted that the non-alcoholic beverages subsector remains a major contributor to the food and beverage industry, one of the strongest pillars of Nigeria’s industrial economy, adding that additional tax burden on the industry would inevitably increase production costs, raise consumer prices, weaken demand, reduce capacity utilisation, and threaten jobs across the value chain.

READ ALSO: Budget crisis tops agenda as Nigeria’s Jimoh Ibrahim takes helm of key UN committee

“Any additional tax burden on the industry would inevitably increase production costs, raise consumer prices, weaken demand, reduce capacity utilisation and threaten jobs across the value chain. At a time when the economy needs stronger industrial growth, this Senate proposal risks becoming a tax on production, investment and employment.

“The proposed legislation also runs contrary to the spirit of the ongoing fiscal and tax reforms designed to create a more investment-friendly business environment. The 2026 fiscal policy framework already provides for an excise duty of ₦10 per litre on non-alcoholic beverages.

“Further escalation of the tax burden through additional legislation would create policy inconsistency, heighten regulatory uncertainty and undermine investor confidence. Investors thrive on predictability. Frequent additions to the tax burden send the wrong signal to both existing and prospective investors,” it added.

While recognising the importance of addressing the growing incidence of diabetes and other non-communicable diseases in the country, the Centre, however, argued that available evidence suggests that sugar taxes, on their own, deliver limited public health outcomes.

“If the objective is to improve public health outcomes, lawmakers should prioritise legislations that directly address the root causes of lifestyle-related diseases, including: Nutrition Education, Public Health Awareness campaigns, Promotion of exercise and physical activity, Encouragement of healthier food choices, Improved preventive healthcare systems, and Urban planning that supports active living through walking and cycling infrastructure,” it added.