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The Centre for the Promotion of Private Enterprise (CPPE) has objected to the proposed increase in excise duty on non-alcoholic beverages, describing it as counterproductive and harmful to Nigeria’s fragile economic recovery.
Director of the centre, Dr. Muda Yusuf, said the proposal comes at a time when manufacturers, SMEs, distributors and retailers are already struggling with inflation, rising input costs, high energy prices, foreign exchange volatility and weak consumer demand. According to him, the manufacturing sector, one of the country’s largest job creators, is under intense pressure, and any further tax burden could worsen its situation.
Yusuf noted that beverage prices have risen by as much as 200–300% in recent years due to inflation and previous tax adjustments, leaving many producers and SMEs barely surviving.
Introducing another round of excise hikes now, he warned, would shrink output, weaken purchasing power, trigger job losses and push more operators out of business. He stressed that Nigeria cannot risk factory closures or layoffs at this delicate stage of recovery.
The CPPE boss also highlighted the wider economic and social risks. Higher taxes on beverages, he said, will immediately translate to higher prices for consumers already grappling with soaring costs of food, transport and basic goods, fuelling additional inflation. The beverage value chain, spanning manufacturing, logistics, retail and the informal sector, supports thousands of jobs, and any contraction could worsen unemployment.
On revenue, he argued that the government may not benefit as expected, as declining production and shrinking sales could reduce tax collections rather than increase them.
Yusuf further pointed to procedural issues, insisting that excise policy falls under the Federal Ministry of Finance, yet the current initiative appears driven by the Senate Committee on Finance and the Ministry of Health, with limited consultation with key committees or stakeholders. This, he said, undermines policy coherence and could send negative signals to investors.
While acknowledging concerns around sugar consumption, he said targeting only non-alcoholic beverages is unfair, as sugar intake in Nigeria largely comes from a wide range of products including bread, pastries, milk beverages and carbohydrate-heavy staples. He recommended a holistic public health strategy focused on nutrition education, proper food labelling, lifestyle awareness and voluntary industry-led sugar reduction programmes, noting that behavioural change—not punitive taxation—drives sustainable health outcomes.
After consultations with industry operators, economists and policy analysts, the CPPE called for the withdrawal of the proposed excise increase. It advised that excise rate-setting should remain an administrative function to ensure flexibility, and urged the government to prioritize broader public health initiatives.
The organisation also encouraged stronger collaboration between government and manufacturers on low-sugar and zero-sugar product options, responsible advertising and consumer awareness campaigns.
Yusuf concluded that Nigeria’s manufacturing sector requires stability-oriented policies, not additional tax burdens that threaten jobs, welfare, investment and long-term industrial competitiveness. He urged the Senate Committee on Finance, the Presidency and the Ministry of Finance to reconsider the proposal and maintain coherence across fiscal policy decisions.
