Nigeria senate divided over proposed excise tax hike on carbonated sugar drinks
Health bodies backed an SSB tax hike and earmarking for disease prevention, while manufacturers and finance officials flagged economic and fiscal concerns.
NIGERIA – A legislative push to raise excise duty on carbonated sugar-sweetened beverages (SSBs) in Nigeria has triggered strong friction among stakeholders from the health, manufacturing, finance, and consumer advocacy space during a Senate-organised bill review hearing.
The disagreement surfaced at a joint public hearing led by the Senate Committees on Finance and Customs. The session examined a bill proposing a shift from a flat excise charge to a percentage-linked levy per litre on carbonated SSBs. The policy intent centres on reducing high sugar intake while generating additional revenue for the country’s healthcare needs.
The bill, introduced by Senator Ipalibo Harry Banigo, seeks to revise the Customs, Excise, Tariffs, etc Act. A core provision of the amendment includes dedicating a defined portion of SSB tax proceeds to healthcare expansion programmes, preventive care, and infrastructure improvements, positioning taxation as a dual fiscal and public health instrument.
The Coordinating Minister of Health and Social Welfare, Professor Muhammad Ali Pate, endorsed the bill, framing it as a forward-leaning mechanism for public health funding. He described it as a model that uses fiscal policy to support prevention-focused health systems.
Pate highlighted international case studies, including the Philippines, where sugar tax models have strengthened public health delivery and widened universal health benefits, suggesting similar gains are possible in Nigeria.
He urged lawmakers to consider increasing the duty from the current benchmark of N10 per litre to a minimum of 20 per cent of the product’s retail price, citing alignment with global health taxation thresholds.
The minister further recommended that 40 per cent or more of the collected revenue be statutorily committed to diet-related disease prevention programmes, with targeted spending on conditions such as cancer care, diabetes response, hypertension screening, health education, and primary healthcare systems support.
He cautioned that rising non-communicable diseases could intensify national treatment costs if fiscal levers for prevention were not activated promptly.
The Nigeria Cancer Society, the Diabetes Association of Nigeria, and broader public health advocates voiced institutional backing, reinforcing disease prevention financing as a strategic priority for the bill’s revenue design.
Meanwhile, the Manufacturers Association of Nigeria (MAN), the Ministry of Finance, and the Nigeria Employers’ Consultative Association (NECA) warned that an excise surge could destabilise manufacturing employment.
MAN’s representative, Adeyemi Folorunsho argued the sector is susceptible to cost-driven contraction, a shift that could influence production overheads, distribution margins, and direct labour exposure.
Folorunsho also contested any empirical linkage between SSB intake and the national prevalence of obesity and diabetes, asserting that Nigeria’s average per-capita sugar consumption ranks among the world’s lowest.
He cited national sugar volume estimates for comparison, proposing that current consumption levels fall below global averages, and pressed for balanced outcomes that protect industry competitiveness alongside health goals.
The Ministry of Finance maintained that excise proceeds should not be ring-fenced, emphasising that national budgeting and tax revenue channels must remain within the Federal Government’s discretionary scope.
Senator Musa assured stakeholders that the bill’s final iteration would be shaped by transparency, public interest considerations, and equity across both economic and health imperatives.
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