The Nigeria Employers’ Consultative Association (NECA) has kicked against the increase in excise duty on carbonated drinks, tobacco, spirits, as well as other alcoholic and non-alcoholic beverages by the Federal Government.
The body, which described the planned increase through the ministry’s tariff technical committee as another burden too many, said it conflicts with the recently-established 2022 Fiscal Policy Measures and Tariffs Amendments (FPM 2022) which covers 2022-2024.
Director-General, Nigeria Employers’ Consultative Association (NECA), Adewale Oyerinde, said businesses are still recovering from challenges that are threatening to incapacitate its productive capacity and contribution to national development.
He said a move to hike excise in an unsustainable manner could cause government revenue from the industry to significantly plunge rather than increase.
“Historically, huge increases in excise duty often do not translate to increased revenue in the medium to long term. The more sustainable an excise regime is, the better the industry can contribute to the government treasury,” he said.
Oyerinde also recalled that recent economic growth in Nigeria has been driven largely by the non-oil sector.
He said subjecting the sector to further hardship does not bode well for the future of the industry nor the growth of government revenue in 2023 and beyond.
He said the current minimal growth of the economy was an indication that a huge tax hike would not achieve the desired results for all stakeholders.
He urged that the rate of increase in the roadmap of the Fiscal Policy Measures and Tariffs Amendments 2022 should be maintained.
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