MAN Applauds The FG's Decision To Stop Raising Excise Duty.

The Federal Government’s decision to put a stop to the proposed rise in excise duty on cigarettes, alcoholic beverages, and non-alcoholic beverages and to let the sectoral roadmap for 2022–2024 run its full course has been applauded by the Manufacturers Association of Nigeria (MAN).

Segun Ajayi-Kadir, the director general of MAN, said that during a visit the finance minister, Zainab Ahmed, gave the organization the assurance that the revisions to the 2023 Finance Act and the Fiscal Policy Guidelines had been completed and would be published shortly.

She promised that the guidelines would not include the anticipated hike in excise taxes on tobacco, beer, wine, and spirits in 2023. Instead, she said, “We will allow the excise system to run its full course from 2022 to 2024 as planned by the Federal Government in the Road Map in 2022.

The union claimed that the introduction of the N10 per litre excise levy on all non-alcoholic, carbonated, and sweetened beverages in the nation in 2022 would be a significant setback for the productive sector.

The fee was a component of a new policy that was included in the Finance Act, which President Muhammadu Buhari signed into law along with the 2022 Appropriations Bill on December 31, 2021.

She claims that the new sugar tax was implemented to increase excise taxes and revenues for essential spending on health care and other things in keeping with the 2022 budget priorities.

Whilst N81 billion in revenue was anticipated from 2021 to 2025, the potential loss to the government in the form of other taxes and a reduction in revenue leaves much to be desired.

A new tax on fizzy beverages and other items would be counterproductive, the MAN cautioned through a number of advocacy channels. Instead, the government should find other ways to raise money without unintentionally strangling the already-struggling productive sector. The proposed increase in excise duty on beer, wines, spirits, tobacco, and non-alcoholic beverages in 2023 became another nightmare to a sector gasping for survival amid obvious setbacks caused by Naira scarcity, forex crunch, infrastructure deficit, to name a few. The sector is still dealing with a recent increase in line with a three-year roadmap.

A team from the Manufacturers Association of Nigeria (MAN), led by its president, Otunba Francis Meshioye, paid a courtesy visit and presentation to the Minister of Finance, Budget, and National Planning. The visit’s outcome allayed MAN’s concerns. The honorable minister informed the delegation of the government’s dedication to the health of the manufacturing sector and the affected industries.

The organization is pleased with the Minister’s guarantees that the revisions to the Finance Act 2023 and the Fiscal Policy Guidelines for 2023 have been completed and will be made public right away. She specifically guaranteed that the guidelines would not include the anticipated increase in excise duty on tobacco, beer, wine, and spirits, as well as non-alcoholic beverages in 2023, but rather would allow the excise regime to run its full course from 2022 to 2024 as planned by the Federal Government in 2022 and outlined in the Road Map.

This waiver will signal the administration’s support for the continuation of manufacturing in Nigeria on this score and will be a major relief to our members throughout the Federation.

“In addition, MAN received the government’s understanding regarding the implementation of a 0.5% import surcharge, which is intended to fulfill Nigeria’s obligations to the continental agreement in the implementation of the Africa Continental Free Trade Area (AfCFTA) agreement, as well as the promised intervention regarding the resolution of the snags in the interpretation of the Tin Plate, HS Code 7210. 12.00.00 with the Nigeria Customs Service.

The group sees the Federal Government’s action as encouraging for its members, who are now dealing with historically low sales, tight currency markets, insufficient electricity supplies, and a number of taxes and levies from all three levels of government. Members will be reassured by this action that the government values discussion between the public and private sectors and that it respects stakeholder input.

“We anticipate improved manufacturing sector and economic performance as MAN continues to engage with the government meaningfully on issues pertaining to the nation’s economic success.”