Nigeria’s Manufacturers Association Hails Government’s Suspension of Beverage Excise Duty

The Manufacturers Association of Nigeria (MAN) has commended the Nigerian government for its decision to suspend the excise duty of N10 per litre on all non-alcoholic, carbonated and sweetened beverages in the country.

The introduction of the excise duty was a major setback for the productive sector in 2022, according to MAN. The excise duty was part of a new policy introduced in the Finance Act signed into law by President Muhammadu Buhari on December 31, 2021, alongside the 2022 Appropriation Bill.

Although the expected revenue was projected at N81bn from 2021-2025, the potential loss to the government in other forms of taxes and revenue cuts left much to be desired, the association said in a statement. MAN also noted that the proposed increase in excise on beer, wines and spirits, tobacco and non-alcoholic beverages in 2023 became another nightmare to a sector struggling for survival, amid evident setbacks occasioned by naira scarcity, forex crunch, and infrastructure deficit.

However, the association has been reassured by the Honourable Minister, Hajiya Zainab Ahmed, that the 2023 Fiscal Policy Guidelines and the reconsideration of the Finance Act 2023 have been concluded and will not include the proposed increase in excise duty on beer, wines and spirits, tobacco and non-alcoholic beverage 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 move by the government is a huge relief to MAN members across the federation and will signpost the administration’s support for the sustenance of manufacturing in Nigeria on this score, the association said. MAN also received the understanding of the government on the introduction of a 0.5% import surcharge, which was meant to fulfil Nigeria’s obligations to the continental agreement in the implementation of the Africa Continental Free Trade Area.

This move will reassure members of the administration’s respect for stakeholder’s engagement and the usefulness of public-private partnerships, according to MAN. The association views this as a positive step towards encouraging its members, who are currently struggling with low sales, forex squeeze, inadequate electricity supply and multiple taxes and levies from the three tiers of government.