The recent introduction of excise duty on soft drinks will mark the beginning of the decline of the sub-sector in Nigeria, writes Dike Onwuamaeze
This was disclosed by the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, when she did the public presentation of the 2022 Appropriation Act in Abuja on January 5 this year. He also said that government has failed to give a thought about some manufacturers that have reformulated their products and have currently added zero sugar carbonated soft drinks to their offerings. He said that they are entitled to certain exemptions.
Finance Act grants tax incentives to industries in the agricultural sector. Excise duty on non-alcoholic beverages will be reflected here, which will increase the total cost of production especially on already compliant companies. This impact will spill over to different players in the value chain including packaging, distribution and retail industries in terms of costs and product availability.
“What is not realised by many is that excise begets high production costs, which in turn adversely affect production levels and intimately result in dwindling profits. This will grossly impact the small and emerging business owners in the non-alcoholic beverage sector. “An introduction of an additional tax will cause manufacturers in a bid to offset tax and maintain profit raise prices of their products to higher rates thus shifting tax incident to consumers,” Ajayi-Kadir argued.
“It is imperative that government, in the interest of Nigerians and the economy, should suspend the reintroduction of excise duty on carbonated drinks. Rather, Government should continue to support and promote the industry to attain full recovery after the onslaught of the COVID-19 pandemic and position it to further accommodate the teeming unemployed Nigerians, particularly the youths.
“Our concern is the mass hunger that would result from the slightest increase in the retail price of soft drinks owing to imposition of excise duties as it would be priced beyond the reach of many Nigerians.”
Singapore Singapore Latest News, Singapore Singapore Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: GuardianNigeria - 🏆 1. / 94 Read more »