Coalition Asks FG to Incorporate N20 Beverage Tax into 2023 Finance Act

Sunday Ehigiator

The Sugar-Sweetened Beverages Coalition has tasked the federal government to incorporate the proposed N20 per litre tax on beverages and other sweetened products in the 2023 Finance Act.

The coalition justified the incorporation of the proposed tax on the need to reduce the diabetes-related health expenditure in Nigeria, which according to the World Health Organisation (WHO), annually cost N745 billion.

Executive Director of Corporate Accountability and Public Participation Africa (CAPPA), Mr. Akinbode Oluwafemi made this call recently at a news conference he addressed in Lagos to other members of the coalition.

At the news conference, Oluwafemi challenged the federal government “to stand firm in defending the health of the country by enacting the proposed N20 per litre tax on beverages and other sweetened products into the 2023 Finance Act.

He lamented that the carbonated drinks industry “has been resisting the tax proposal. The industry has been using all kinds of tricks in their playbook to intimidate, threaten, and even manipulate the media against the policy.”

Explaining the importance of the tax proposal to the country’s health security, Oluwafemi said the tax would not only come with the health benefits but a double win for the government as it will lead to increased revenue. 

He further pointed out that the increased government revenue can be used to fund health-related initiatives or other expenditures and reduce the sum of N745 billion, which Nigerians managing diabetes-related conditions spend annually.

Oluwafemi said the current N10 per litre tax imposed on beverages and other sweetened products “has been easily absorbed by the producers, a defeat of the initial policy purpose.

“Even at N20 per litre, we are still behind the WHO recommendation. The federal government should stand firm, and very firm in defending the country’s public health by enacting the proposed N20 per litre tax into law with immediate application from January 1, 2023.

“SSBs include non-alcoholic beverages we popularly refer to as soft drinks (i.e., cola and sodas), juices (even 100 per cent juices), nectars, sweetened coffee, sugarcane juice, malt drinks, sweetened tea, energy drinks, sport drinks and flavoured dairy drinks. They are always loaded with high calories and add no nutritional value.

“The high calories consumed in SSBs lead to excessive weight gain. SSBs’ liquid sugar is easily absorbed into the body. Those sugars alter the body’s metabolism, affecting insulin, cholesterol and metabolites that cause high blood pressure and inflammation.

“The federal government has consistently maintained that the SSB tax is pro-health and aimed at reducing over-consumption of sugary drinks to lower the burden of non-communicable diseases (NCDs).

“In 2021, the International Diabetic Federation (IDF) said the diabetes-related health expenditure in Nigeria grossed N745 billion. This is a staggering cost for a nation where many live below the poverty line.

“The cost of managing complications of diabetes is not unconnected to the fact that Nigeria now ranks fourth on the global list of countries consuming sugary drinks,” Oluwafemi explained.

Also at the news conference, a public health professional with the University of Ibadan, Dr. Francis Fagbile, cautioned against pumping more refined sugar into the body, noting that the food people consume already has the sugar needed by the human system.

He harped on healthy lifestyles to check the increasing NCDs, urging the government to be more decisive with the SSB tax by way of raising it up and implementation to discourage wanton consumption of sugary products.

Also, Barnabas Yahaya of Tobacco Control Alliance urged lifestyle moderation to contain NCDs and other health crises linked to intake of sugary drinks and related products.

The federal government had in 2021 introduced the sugar-sweetened beverages tax. The N10 per litre excise tax was introduced through the Finance Act, 2021 on carbonated drinks and sugar-sweetened non-alcoholic beverages produced, imported, distributed, and sold in Nigeria.

The tax being collected by the Nigerian Customs Service (NCS) on behalf of the federal government did not come into force until June 2022.

Medical conditions like diabetes; obesity and other complications associated with unchecked consumption of sugary drinks are in the category of the largest killer on a global scale.

WHO had noted that more than 41 million people die from non-communicable diseases with 77 per cent of that staggering death occurring in the low-and-medium income countries where Nigeria is also categorised.

The global health body had further noted that an unhealthy diet increases the chances of dying from non-communicable diseases and recommended a 20 per cent tax on the final retail price of the SSB product.

Against the backdrop, the federal government had proposing an additional N20 per litre tax on non-alcoholic beverage products, which covers the widely consumed beverages and other sweetened products.