The Senate, on Tuesday called on the Federal Government to suspend the planned excise duty increase on locally produced alcoholic beverages set to go into effect on June 4th. The Upper Chamber of the National Assembly said that the increase which would raise the excise duty rate on alcoholic beverages from the current rate of 20% to 67% represents a 300% increase and should be suspended until there is a better understanding of the new policy by all stakeholders in the interest of the national economy.
According to the senate, the measure to suspend the proposed rate hike is meant to safeguard the sector from complete collapse.
The legislative body said it will initiate a stakeholder’s public hearing by referring the motion to the relevant committee for a full discussion with the Federal Government and relevant stakeholders in the beverage sector so as to get a better understanding of the issues and assist government to take the best action in the overall interest of Nigerians affected by the new policy.
The resolution of the senate on Tuesday follows a motion introduced by Senator Benjamin Uwajumogu (APC, Imo North) and co-sponsored by Enyinnaya Abaribe (PDP, Abia South).
Senator Uwajumogu, while moving the motion said: “The current excise duty paid by the locally produced beverages sector stands at 20 percent across board but under the approved excise duty tariff hike by the Federal Government, it is fixed at 67%; over 300% increase.”
He noted that the beverage industry which is one of the oldest surviving industries currently employs over 250,000 Nigerians with an investment portfolio of over N420bn which would be threatened to extinction if the new tariff hike were to go into effect.
According to him, the proposed excise duty increase was computed without full consultation of members of the beverage sector and all other stakeholders within the industry known as Distillers and Beverage Association of Nigeria (DIBAN), a sub-sector of the Manufacturers Association of Nigeria (MAN).
“If this proposed hike is not reviewed, one of the consequences will be the potential loss of at least 250,000 jobs as manufacturers within this sub-sector will be left with no option than to massively lay off workers,” the Senator warned.
He added that the direct and indirect job losses as a result of the tariff increase will further worsen the deteriorating unemployment situation in the country as well as the attendant social consequences.
Powered by WPeMatico