Nigeria Says New Excise Duty Rates Not Targeted At Local Manufacturers.
BARBARA Abuja, Abuja
The Ministry of Finance has announced that the new excise duty rates approved by President Muhammadu Buhari on alcoholic beverages and tobacco were not targeted at local manufacturers.
In a statement signed by the Director of Information, Ministry of Finance, Hassan Dodo said earlier on there were reports that the new excise duty rates which came into effect from Monday, June 4, 2018, were targeted at local manufacturers.
He said the policy was targeted at reducing the health hazards associated with tobacco-related diseases and alcohol abuse.
The statement said the new excise regime seeks to achieve a dual benefit of raising government’s revenues to support the nation’s growth. It read in part, “Contrary to claims that the rates were selectively imposed on local manufacturers, there is currently a 60 per cent duty rate imposed on imported alcoholic beverages and tobacco as part of measures by the government to encourage local production and protect local manufacturing industry.
“It should also be noted that beer and stout are currently under import prohibition to protect the industry from unfair competition from foreign brands.” “In addition, other locally excisable products such as non-alcoholic beverages, cosmetics, perfumes, corrugated papers or paper boards and cartons have no excise duties.
The ministry in the statement also said that stakeholders were not consultant before the new rates were approved by the Federal Government.
It explained that the approved excise duty rates followed all-encompassing engagements with key industry stakeholders by the Tariff Technical Committee, of which Manufacturers Association of Nigeria is a member.
“The stakeholders’ engagements contributed to the final recommendation,” it added. The statememt further stated that the Federal Government was committed to the industrialization agenda for the economy adding that the government would continue to put in place fiscal policy measures to protect local manufacturers and stimulate the growth of the economy.
Under the new excise duty rates, consumers of alcoholic beverages and tobacco are to pay more for the products. In order to implement the newly approved excise duty rates for tobacco, the government said in addition to the 20 per cent ad-valorem rate, each stick of cigarette would attract a N1 specific rate (N20 per pack of 20 sticks) in 2018; a N2 specific rate per stick (N40 per pack of 20 sticks) in 2019 and a N2.90k specific rate per stick (N58 per pack of 20 sticks) in 2020. For Beer and Stout, the government said this would attract 30 kobo per centiliter in 2018 and N0.35k per centiliter each in 2019 and 2020. Wines would attract N1.25k per centiliter in 2018 and N1.50k per centiliter each in 2019 and 2020. For spirits, the government approved N1.50k per centiliter in 2018, N1.75k per centiliter in 2019 and N2 per centiliter in 2020.
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