The NLC has lambasted the FG over the newly introduced N10/litre excise duty on soda drinks.
On Thursday, January 6, the President Buhari-led introduced the N10/litre excise duty to control diabetes.
This was announced by the Minister of Finance, Budget and Planning, Zainab Ahmed.
According to a statement released by the Minister, N10/litre excise duty has been placed on non-alcoholic carbonated and sweetened beverages otherwise known as Soda drinks.
She said that this would help control the cases of diabetes and promote healthy living.
Ahmed said the tax would also support revenues for health-related and critical expenditures.
In an article obtained from Vanguard, the stakeholders have petitioned President Buhari.
The President of the Nigeria Labour Congress, Ayubba Wabba listed those in the petition.
- President Buhari.
- Senate President
- Speaker of the House of Representatives.
- Minister of Labour and Employment.
Wabba said this new directive cost at least 15,000 losses of direct and indirect jobs. This includes casual and contract workers.
“We have rejected the new tax on carbonated drinks because of its huge negative impacts on our sector and workers.
“The worst of it will be that of job losses.
“These companies provide both direct and indirect jobs for Nigerians from permanent to casual employees, suppliers, distributors and retailers, and all these runs into several millions.
“At least, it will cost us no less than 15,000 direct and indirect jobs, including casuals and contract workers.”
Wabba explained further that this would also affect the consumer-end purchase of these drinks.
He argued in a letter sent to Vanguard in November 2021, that the Federal Government has no case.
Wabba explained further that these drinks are essential to the ordinary man. He added that the excise duty on the drinks would not only affect the manufacturing company but consumers.
“Excise duties as indirect taxes on products automatically translate to cost transfer to the end consumers. The re-introduction of excise duties on non-alcoholic beverages would mean an astronomical price increase on the cost of carbonated drinks. These drinks are not luxury but essential food items for the ordinary person who can just consume a bottle of soft drink and a loaf of bread to keep hunger at bay for several hours.
“While we appreciate the fact that government needs more revenue to meet its statutory responsibilities, as a workers’ organization, we feel we have a duty to appeal to government that it should not kill the goose that lays the golden eggs just because it desires to harvest more eggs from the goose.
“The policy would push carbonated drinks producers to neighbouring countries as was the case with Dunlop and Nestle. This should not be the thinking of government when we need to do all we can to protect the jobs of Nigerians by keeping our industries.
“With 38 per cent of the entire manufacturing output in Nigeria and 22.5 per cent share representation of the entire manufacturing sector in Nigeria, the food and beverage industry is the largest industrial sub-sector in our country. The food and beverage sub-sector has generated to the coffers of government N202 billion as VAT in the past five years, N7.3 billion as Corporate Social Responsibility and has created 1.5 million decent jobs both directly and indirectly.
“The beverage sub-sector alone will lose 40 per cent of its current sales revenue. This translates to a loss of N1.9 trillion. While the government will only make total projected receipts of N81 billion from the proposed re-introduction of the excise duties, it will lose N197 billion in VAT, Company Income Tax and Tertiary Education Tax as a consequence of expected downturn in overall industry performance should the excise duties be effected as being planned.”