CIFIAN: Increased Excise Tax on SSBs will Cause Job Cut, Threaten NSMP

Raheem Akingbolu

The Chartered Institute of Financial and Investment Analysts, Nigeria (CIFIAN), has urged policymakers to reconsider planned increment on sugar-sweetened beverages.

CIFIAN warned that excise tax increase in the sugar sector would not only shrink the beverage market in the country it would also lead to reduced sugar consumption, job cuts and ultimately disrupt the Nigera Sugar Master Plan (NSMP).

Speaking during a high-level policy workshop themed, “Understanding the Impact of SSB Taxation on Nigeria’s Sugar Economy: Supply, Demand, and the Policy Disconnect,” CIFIAN President, Prof. Godfrey Omojefe, noted that despite the health benefits in driving low or no sugar consumption the SABs tax increase would cause market boycott by consumers to the detriment of the nation’s sugar master plan.

Prof Omojefe urged the Federal Government to align its sugar-sweetened beverage (SSB) tax policy with broader public health objectives and Nigeria’s industrial development goals.

According to him, any steep tax increases on SSBs implemented without a coherent framework would harm the country’s sugar economy, undermine jobs, and fail to deliver the intended health outcomes.

Omojefe said the current N10 per litre excise duty on SSBs, introduced in 2022 has already had significant economic consequences on the sugar economic chain.

Omojefe said, “Nigeria’s sugar intake remains lower than the World Health Organisation’s (WHO) benchmark and far below that of many African and global peers, adding that “focusing solely on punitive taxation without addressing broader lifestyle and dietary factors, will yield limited health gains.”

Omojefe explained that a more effective approach would be to implement a nuanced taxation system that incentivises healthier product reformulation and innovation, while  “ensuring fairness across all high-sugar products rather than singling out SSBs.”

Citing data from the National Sugar Development Council (NSDC), Omojefe revealed that national sugar consumption declined by 16% in 2023, while domestic sugar production fell by 35% — from 46,479 metric tonnes in 2022 to 30,053 metric tonnes in 2023.

He noted that these drops are closely linked to a challenging economic environment and the direct impact of the existing SSB tax on beverage manufacturers, – the largest industrial consumers of sugar.