Food Sector Dying Because of 10% Excise Duty, NUFBTE Tells FG
Ugo Aliogo
Workers in the food sector of the economy have called on the federal government to save the sector from extinction as the 10 per cent excise duty placed on carbonated drinks has caused over 5,000 workers to be thrown out of employment in the last eight months.
The workers, under the umbrella of the National Union of Food Beverage and Tobacco Employees (NUFBTE) in separate letters to the Speaker, House of Representatives, Honourable Femi Gbajabiamila, Minister of Labour and Employment, Senator Chris Ngige, and the President, Nigeria Labour Congress (NLC), Ayuba Wabba, titled, ‘Federal Government Save Our Soul’, stated that food sector is dying because of multiple excise duty /taxation.
According to the union the introduction of the duty has crippled the business from January 2022 till date.
The union recalled that federal government, imposed 10 per cent water taxation on carbonated drinks in food sector last year.
In the letters signed by the President of NUFBTE, Lateef Oyelekan, the union lamented that it has lost over 5,000 workers on redundancy exercise due to excess taxation.
He said: “The life span of finished products (FCMG) is six month; over billions of products have expired and will be discarded because of the price increase of the finished products. Raw materials of the products will be expiring soon probably in December or January which costs over billions of
naira.
The production of goods daily which was formally 12 hours per day, six days a week (Monday – Saturday) has now reduced to eight hours per day and three times a week. Companies that have six production lines have shut three lines down and most companies are now left with three lines to produce due to the excess percentage on excise duty and taxation. Companies are struggling to produce.”
Oyelekan said all the facts given by the union can be verified from the custom officers deployed to each food factories.
According to the NUFBTE president, finished products in companies are being discarded because of its expiration and lack of purchase from customers because of products price increase.
He explained that in the past years companies like Nigeria Bottling Company, Nigeria Breweries Limited, Nestle, Seven Up Bottling Company, International Breweries, Nigeria Flour Mills to mention a few, engaged technical school holders, GCE holders, OND holders, HND holders and train them in the company’s technical training college for a year, after which they were employed. This is not the case again in recent times. Furthermore, each of the afore mentioned companies employed close to 1,000 workers in the past years, but sadly this exercise has stopped in the past two years due to the outrageous excise duty and taxation affecting the sector.”
He also noted that employers are planning to relocate their factories to the neighbouring Africa countries where production cost is lesser and the finished products will be brought to Nigeria to sell, harping that Nigeria would be at the receiving end.
“We are hereby, appealing to the Federal Government for immediate urgent action for the sake and future of Nigerian Youth and Nigeria as a nation,” he said.
