The Senate on Tuesday sought the assistance of the Federal Government to halt the implementation of a new excise duty rate on alcohol and tobacco that came into effect in June until all relevant stakeholders are adequately consulted.
The Upper legislative chamber said a pause would give all stakeholders in the beverage and tobacco industries an opportunity to agree on a consensus rate and implementation approach.
The Federal Ministry of Finance came out on Sunday to defend its newly enacted excise duty rates on alcohol and tobacco, saying that they are not targeted at local manufacturers.
In a statement released by the ministry’s Director of Information, Hassan Dodo, it said that contrary to claims in some quarters, the new excise duty rates, which came into effect from June 4, 2018, were not targeted at local manufacturers.
The National Union of Food Beverage and Tobacco Employees (NUFBTE) has criticised the Federal Government and threatened to go on a labour strike over the planned increase on the excise duty rates for alcoholic beverages and tobacco.
While speaking at a meeting by the organised labour, President of NUFBTE, Lateef Oyelekan, said that more than 20,000 workers are presently employed in the alcoholic and tobacco sector and may lose their jobs if the amendment takes effect.
The International Monetary Fund (IMF) has said that the recently implemented excise duty rates for alcoholic beverages and tobacco products by the Federal Government of Nigeria were too low and instead should be higher to act as “a fail-proof revenue raising strategy.”
The World body is recommending a 100% increase in excise duty be slapped on the affected products to conform to global norms.
The Federal government has signed-off on the implementation of a new excise duty regime on alcoholic beverages and tobacco products as it seeks to raise government’s fiscal revenues.
President Muhammadu Buhari has approved an amendment to the excise tariff rates for alcoholic beverages and tobacco products which are slated to go into effect on 4th June 2018, the Minister of Finance, Mrs. Kemi Adeosun said on Sunday.
The Minister of Finance, Mrs. Kemi Adeosun has recommended increasing excise duty rates on alcohol and tobacco products with implications on their health effects as well as a means of raising revenue.
Adeosun added that her recommendation is in line with the implementation of the ECOWAS common External Tariff (CET), one of the instruments of harmonizing member states to strengthen its Common Market agreed upon on 25th October 2014.
