Coke and Other Soft Drinks in Nigeria to Cost More as Customs Proposes Excise Duty

The Nigeria Customs Service (NCS) is proposing to collect excise duty on soft drinks. This same excise duty was abolished back in 1993 by the interim national government led by Ernest Shonekan after General Ibrahim Babangida abdicated the presidency following the social upheaval after the annulment of the 1993 elections which saw Moshood Abiola getting incarcerated.

Appearing before a joint committee of the senate on finance and national planning on Thursday, Hameed Ali, the comptroller-general of the NCS, said the federal government stop giving tax waivers to companies producing soft drinks in the country.

The comptroller general argued that if companies producing alcoholic beverages and tobacco could pay taxes, those producing soft drinks should also do same.

“We have been pushing for the expansion of our own excise collection. During the (Ernest) Shonekan regime (in 1993), excise was stopped for carbonated drinks manufacturers, like Coca-Cola,” the Ali said.

“The only one approved for us are tobacco alcoholic beverages. The understanding then was that tobacco and alcoholic beverages affect the health of citizens and should be taxed.

“But we know that carbonated drinks are also injurious to the health of the people due to the high sugar content.

“Therefore if tobacco and alcoholic beverages companies are paying tax, the carbonated drink manufacturers should also pay.”

Ali also postulated that the country’s revenue realized from import is projected to reduce due to the number of unfavourable agreements Nigeria has signed.

According to Ali, the NCS is expected to generate 1.2 trillion Naira before the end of the year because it had already collected N830 billion as of the end of July.

Also speaking at the event, Senate President Ahmad Lawan said there was need to look into why companies such as Coca-Cola do not pay excise duty.

“I don’t understand why Coca-cola for instance should not pay excise,” Lawan said.

“It is an established company all over the world and it dominates the soft drinks industry.”

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Irumole Togbono

Irumole enjoys writing, music, swimming and dancing. She is a sucker for information and also loves food :)

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