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7 Jun 2018

New Duty: Alcohol Makers Threaten Buhari With 250,000 Job Loss

The Distillers and Blenders’ Association of Nigeria (DIBAN) has advised the Buhari government to halt implementation of the new excise duty on locally produced alcoholic beverages and tobacco.
The association warned that “astronomical hike in the excise duty” will cause loss of 250,000 jobs and investment portfolio of over N420 billion, advising the government to prepare for offshoot.

DIBAN said this during a peaceful protest at the premises of the Manufacturers Association of Nigeria (MAN) in Lagos.

Stress that they are not against federal government’s bid to shore up fiscal revenue, DIBAN warned that the high excise duty could hurt the economy and result in high rate of smuggling of foreign wines and spirits into the country.

Chairman, DIBAN, Chief Patrick Anegbe explained that the new duty approved for implementation by the minister, translates to an increase in duty from current average of N30 per litre to N150 per litre in the first year and N200 per litre subsequently.

He said this translates to an increase from current average duty of N270 to N1350 per case (carton) in the first year and N270 to N1800 per case (carton) from second year.

“We are also disturbed that the new hike will not only affect the Wines and Spirit industry but also other key sectors of the economy and businesses such as packaging industries, bottles, cartons, labels, cork, glue, Ink, printing, laboratory, marketing, consulting, media, to mention a few”, he said.

“We are particularly worried that our industry investment of over N420 billion is being threatened by the recent upward review of Excise duties on locally produced Wines and Spirits.

“We strongly hold the view that if the intention of government is to grow local industries, imposing exorbitant duties on locally manufactured goods is a contradiction of that objective”.

Speaking, the Director-General, MAN, Mr. Segun Ajayi, said that it was a wrong timing on the part of the federal government to increase the consumption tax without making reference to the prevailing economic conditions in the country.

“The rate is astronomical. This means that there will be 545 per cent on a product that is majorly consumed by the people at the low-end of the market. What you have is raising the hands of the foreign brands. We need to be very strategic because it is a trade issue”.

“If you increase the excise duty because you want to guarantee the health safety of the consumers, you might be doing this in the other way round”.

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