Centre For Private Companies Asks Law Makers To Reject Sugar Beverage Tax Bill

The Centre for the Promotion of Private Enterprise (CPPE) has called on the House of Representatives to reject the Sugar-Sweetened Beverage Tax Bill as it would worsen cost pressures for manufacturers already battling high energy costs, interest rates, and weak consumer demand.

The chief executive officer of CPPE, Dr. Muda Yusuf said the bill is ‘ill-timed’ and inconsistent with government’s commitment to ease the cost of doing business.

According to him, the Centre is shocked and deeply concerned that the Senate has proceeded with the passage of the Sugar-Sweetened Beverage Tax Bill despite overwhelming objections from private sector stakeholders, led by the Manufacturers Association of Nigeria (MAN).

With the food and beverage sector a major driver of industrial output and employment, Yusuf argued an additional excise tax would raise production costs, increase prices, and threaten jobs across agriculture, packaging, logistics, and retail value chains.

He noted that the industry is one of the strongest pillars of Nigeria’s industrial economy, accounting for a significant proportion of manufacturing output and jobs, noting that “its extensive linkages with agriculture, packaging, logistics, retail trade, hospitality and distribution make it a powerful engine of inclusive economic activity. The non-alcoholic beverages subsector is a major contributor to this ecosystem and should be supported, not burdened with additional taxation.

“Any additional tax burden on the industry would inevitably increase production costs, raise consumer prices, weaken demand, reduce capacity utilisation and threaten jobs across the value chain. At a time when the economy needs stronger industrial growth, this Senate proposal risks becoming a tax on production, investment and employment.”

Yusuf pointed out that “the proposed legislation also runs contrary to the spirit of the ongoing fiscal and tax reforms designed to create a more investment-friendly business environment. The 2026 fiscal policy framework already provides for an excise duty of N10 per litre on non-alcoholic beverages.

“Further escalation of the tax burden through additional legislation would create policy inconsistency, heighten regulatory uncertainty and undermine investor confidence. Investors thrive on predictability. Frequent additions to the tax burden send the wrong signal to both existing and prospective investors.”

He stated that “CPPE recognises the importance of addressing the growing incidence of diabetes and other non-communicable diseases in the country. However, available evidence suggests that sugar taxes, on their own, deliver limited public health outcomes.

“The major drivers of diabetes and related health conditions in Nigeria include poor dietary habits, excessive consumption of carbohydrate-rich foods, physical inactivity, sedentary lifestyles, inadequate health awareness and genetic predisposition. Taxation does little to address these underlying factors. What it achieves is an immediate increase in production costs, higher consumer prices and additional pressure on investment and employment.”

He insisted that “if the objective is to improve public health outcomes, lawmakers should prioritise legislations that directly address the root causes of lifestyle-related diseases.”

CPPE CEO urged, “the House of Representatives to decline concurrence to the bill. The proposed legislation is fundamentally anti-growth. It penalises production, discourages investment, threatens jobs and imposes additional costs on already burdened consumers.

“The House of Representatives has historically demonstrated sensitivity to the welfare of citizens and the concerns of productive enterprises. We urge members to uphold that tradition by rejecting this legislation in the interest of manufacturing sustainability, employment preservation, investment confidence and policy coherence.”