Taxation on beverages in Nigeria: Impact and burden of the new policy

Abstract

The Nigerian Government recently signed into a law a policy on 31 December 2021 that mandates the payment of an excise duty of 10 NGN (about US$0.02) per liter on all nonalcoholic and sweetened beverages in the country 1 . Some of the stated reasons were to discourage excessive sugar consumption in beverages, which can lead to a variety of health problems, including diabetes and obesity and to increase excise duties and revenue for healthcare and other essential spending 1 . Without doubt, this has sparked a flare of reactions and opinions on either side of the relevance of the new policy, its impact on healthcare and the economy at large.Nigeria shares a large portion of the global soft drink market and is projected to increase to a market size of 10 billion US$ (in retail prices) between 2021 and 2026 in the country. This is an indication that over-consumption of sugar in beverages is becoming a public health problem that requires urgent attention 2 . Many countries have previously enacted laws to impose or increase taxes on specific foods, such as soft drinks, sweets, chocolate, ice cream, or other unhealthy foods, with the goal of combining budgetary and health benefits 3 . A strong rationale for this is that an imposition of tax increases the price of such products, which in turn reduces consumption 4 . It is also true that when 'sugar taxes' are combined with incentives to eat better foods, the potential for improved health is much greater 5 . Ensuring the health of all citizens is the core responsibility of any country's health system and reducing the intake of sugarsweetened beverages could be beneficial in combatting the rising prevalence of non-communicable diseases.However, the enforcement of this policy without any longterm research, conducted in tandem to assess its efficacy in reducing the consumption of sugar sweetened beverages 1. Olatunji S, Orjiude A. New tax on carbonated drinks'll worsen

Can sugar taxes be used for financing surgical systems in Nigeria? A mixed-methods political economy analysis

“…On 31 December 2021, Nigeria became the second LMIC in sub-Saharan Africa to impose levies on SSBs, with the enactment of a new finance law stipulating a specific excise tax of 10 Naira (N) per litre of non-alcoholic, carbonated sweetened beverages ( Adedeji and Iii, 2022 ). The policy implementation became effective on 1 June 2022.…”

The impact of sugar tax on carbonated soft drinks in Nigeria

“…Ensuring the health of all citizens is the core responsibility of any country's health system and the imposition of a sugar tax could be beneficial in combatting the rising prevalence of obesity and diet-related non-communicable diseases thereby improving population health (Adedeji, et al, 2022;Papier, et al, 2017;Zhang, et al, 2020).…”