FG to review taxes on tobacco and alcohol, as brewers suffer loss

, Economy

The Federal Government of Nigeria is set to embark on a downward review of the 2018 excise duties imposed on products made by brewing companies in Nigeria.

Basically, the extant tax laws were proposed by the former Minister for finance, Kemi Adesoun, to boost non-oil revenue amid declining income from the oil industry.

It has been argued that incremental rises in these products (alcohol and tobacco) somewhat aligns with global best practices, because most Governments around the world generally tax alcoholic drinks and tobacco for the dual purpose of revenue generation and discouraging the harmful effects of such products.

However, for a recovering economy like Nigeria, keeping factories running and providing jobs are as important as plugging the revenue hole.

Main Alcohol-Beverage companies are struggling for sales

According to the report, the main alcoholic beverage producers in Nigeria which include Anheuser-Busch InBev SA, Heineken BV and Diageo Plc have continued to struggle to improve increase sales due to the contraction witnessed in the economy since 2016.

FG now rethinking earlier policy? 

According to the email response to questions received from Paul Abechi, the spoke person for the Finance Minister, Zainab Ahmed, the difficulties witnessed by the alcoholic beverage companies are forcing the government to rethink the taxes earlier imposed.

“FOLLOWING CONTINUED CONSULTATION BY THE GOVERNMENT, IT HAS BEEN DECIDED AND APPROVED THAT THE EXCISE DUTIES ON WINES AND SPIRIT SHOULD BE REVIEWED.

“THE PROCESS HAS BEEN SET IN MOTION THROUGH THE RELEVANT DEPARTMENTS AND INTER-MINISTERIAL COMMITTEES AND IT WILL SOON RESOLVE THE MATTER IN A MUTUALLY BENEFITING WAY.”

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