The Nigeria-British Chamber of Commerce (NBCC) has advised the federal ministry of finance, budget and financial planning against increasing excise duty on alcoholic and non-alcoholic beverages, and tobacco, among others.
The body, instead, urged the government to retain the approved excise regime in the FPM 2022-2024 plan.
Bisi Adeyemi, the NBCC president, said this in a statement at the weekend.
The NBCC said the policy might impact Nigerian business space negatively, thus it urged the government to review the policy.
“While we understand and appreciate the need to improve federal government income, a holistic review of the peculiarities of Nigeria’s current micro and macroeconomic realities, as well as the impact of these on businesses and Nigerians specifically, should be undertaken,” Adeyemi said.
“This is to ensure sustainability and minimise the negative impact on the affected sectors, including the value chain, who will be the hardest hit.
“Long and medium-term plans and policies that will allow for the engagement and input of all stakeholders usually yield optimal outcomes.”
The statement said the country’s manufacturing sector is faced with numerous headwinds, thereby posing a challenge to competitiveness in the global market.
“Even as manufacturers adjust to the approved excise increase in the FPM 2022, the aforementioned conditions are being exacerbated by the fragile state of the country’s economy.
“The benefits of the retention cannot be overemphasised, some of which include a steadily increasing tax contribution from the affected sectors which will be delivered by the 2022 FPM; these sectors are able to support the government’s objective of reducing the high rate of unemployment reported to be at about 33.3%, and improve the inflow of foreign direct investment as investors’ confidence is strengthened by government’s continuous demonstration of its willingness to create an enabling environment through stable and consistent policies,” she said.
“Insights from these discussions with the affected sectors, chambers of commerce, the organised private sector and other stakeholders should form the basis of well-rounded policies.
“Finally, we also implore the government to institute measures to plug current sources of revenue loss such as oil theft as this will reduce the over-reliance on taxes from a struggling manufacturing sector in the short term.”