APSAN Blames Rising Cost of Food Prices on Multiplicity of Taxes

Gilbert Ekugbe

The agricultural produce sellers association of Nigeria (APSAN) has stated that taxes from different internal revenue service on a single commodity is one of the reasons for the rising cost of food prices in the country.

In a chat with THISDAY, the National president, APSAN, Comrade Aloys Akortsaha, explained that over ten regulatory agencies collect tax on a single commodity, saying that the cost is therefore passed to the Nigerian consumers.

“The major issue causing food inflation now is the multiplicity of taxes being faced by APSAN. People have been asking questions about the rise in food prices on a daily basis. We are faced by multiple taxes from different government regulatory agencies on a single commodity. You will find out that taxes are being paid on one commodity to different tax authorities in a State.

“This has to be discourages as we have taking a step by writing to the corporate affairs commission (CAC) petitioning the State Internal Revenue Service of the 36 State Governors including the federal capital territory (FCT) minister and they are on the verge of interfacing with the Minister of Agric based on our allegation which they have promised to take it up by presenting a bill to the National Assembly for a possible amendment of the law,” he said.
“We believe this is one of the solutions and once this is tackled and farmers are getting commensurate value for their produce, the better for everybody,” he added.

On his part, the chief executive officer, Frijay Consult Limited, Mr. Alfred Uwheraka, said inflation has caught up with the nation’s agricultural sector, which has made input and output costs to become high.

“For anybody that is exporting, your product right from home is no longer competitive because you are going to an international market where the price is stable. For example if your products get to US at $3 and another competing product can be gotten for $1, of course the consumers will go for the cheapest. So, this is an issue caused by inflation on agriculture in Nigeria. We also have challenges of logistics. It is costlier to export goods from Nigeria to European union (EU) than from any West African country,” he said.

Meanwhile, the food and agricultural organisation (FAO) on its global food commodity prices index said, commodity prices fell in July for the second consecutive month, according to a benchmark United Nations report.

The global food body stated that food price index averaged 123.0 points in July 2021, 1.2 per cent lower than the previous month although still 31.0 per cent higher than its level in the same period of 2020, noting that the index tracks changes in the international prices of the most globally traded food commodities.

“The July drop reflected declines in the quotations for most cereals and vegetable oils as well as dairy products,” FAO said.

“The FAO cereal price index was 3.0 percent lower in July than in June, pushed down by a 6.0 per cent month-on-month drop in international maize prices associated with better-than-earlier projected yields in Argentina and improved production prospects in the United States of America, even as crop conditions in Brazil remained a concern. Prices of other coarse grains such as barley and sorghum also dropped significantly, reflecting weaker import demand,” FAO added.

FAO however added that wheat quotations edged 1.8 per cent higher in July reaching their highest level since mid-2014 in part due to concerns over dry weather and crop conditions in North America, noting that at the same time, international rice prices hit two-year lows, impacted by currency movements and a slow pace of sales caused by high freight costs and logistical hurdles.

“The FAO dairy price index declined 2.8 per cent from June, impacted by slower market activity in the Northern hemisphere due to ongoing summer holidays, with skim milk powder registering the largest drop, followed by butter, whole milk powder and cheese as the FAO vegetable oil price index reached a five-month low, declining 1.4 per cent from June, as lower prices for soy, rape and sunflower seed oils more than offset rising palm oil values. A lower biodiesel blending mandate in Argentina pressured soyoil prices lower, while those for rape and sunflower oils were influenced by prospective record supplies for the 2021/22 season,” FAO noted.

In contrast, the FAO Sugar Price Index increased by 1.7 percent in July, its fourth monthly increase. The rise was mostly related to firmer crude oil prices as well as uncertainties over the impact of recent frosts on yields in Brazil, the world’s largest sugar exporter, while good production prospects in India prevented a larger jump.

The FAO Meat Price Index rose marginally from June, with quotations for poultry meat rising the most due to increased imports by East Asia and limited production expansions in some regions. Bovine meat prices also strengthened, buoyed by high imports from China and lower supplies from major producing regions. Meanwhile, pig meat prices fell, following a decline in imports by China.