The Centre for the Promotion of Private Enterprise [CPPE] 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. At a time when
government policy is focused on easing the cost of doing business and revitalising
manufacturing, the bill seeks to impose an additional layer of taxation on non-
alcoholic beverage manufacturers, thereby worsening cost pressures across the
value chain.
The bill is ill-timed, insensitive to prevailing economic realities, and inconsistent
with the Federal Government’s commitment to reducing the tax burden on
businesses. At a time when manufacturers are grappling with elevated energy costs,
high interest rates, exchange rate pressures, logistics challenges, weak consumer
purchasing power, and multiple taxes and levies, the imposition of an additional
excise tax on non-alcoholic beverages would further erode industrial
competitiveness and weaken investment prospects.
Threat to Manufacturing, Jobs and Value Chains
The food and beverage industry is one of the strongest pillars of Nigeria’s industrial
economy, accounting for a significant proportion of manufacturing output and jobs.
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.
Policy Inconsistency and Investor Concerns
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 ₦10 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.
Limited Public Health Benefits
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.
A Better Path to Better Health
If the objective is to improve public health outcomes, lawmakers should prioritise
legislations that directly address the root causes of lifestyle-related diseases. These
include nutrition education, public health awareness campaigns, promotion of
exercise and physical activity, encouragement of healthier food choices, improved
preventive healthcare systems, and urban planning that supports active living
through walking and cycling infrastructure. Such interventions are more sustainable, more inclusive and less damaging to economic activity than punitive taxation targeted at a major manufacturing subsector. Public health goals should not be pursued through policies that
inadvertently weaken production, investment and job creation.
House of Representatives Should Reject the Bill
CPPE therefore strongly urges 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.
The Economy Needs Relief, Not More Burdens
At a time when businesses and households are struggling with unprecedented cost
pressures, the economy needs relief, not additional taxation; support for
production, not policies that weaken enterprise; and reforms that create jobs, not
measures that put them at risk.
Public health objectives and economic growth are not mutually exclusive. Nigeria
can pursue both through policies that promote healthier lifestyles while protecting
investment, jobs and industrial development. The Sugar-Sweetened Beverage Tax
Bill fails this test and should therefore be rejected in its entirety.
DR MUDA YUSUF
CHIEF EXECUTIVE OFFICER
CENTRE FOR THE PROMOTION OF PRIVATE ENTERPRISE [CPPE]
7TH JUNE 2026