Nigerians to pay N10 more for soft drinks as FG increases excise duty on carbonated beverages

As FG surpassed N1trn from independent revenue collection

Nigerians are to pay N10 more for  soft drinks as the Federal Government  plans to  impose  excise duties  on  carbonated  drinks .

Minister of Finance, Budget and National Planning, Zainab Ahmed, who stated this  during 2022 Budget breakdown  said the tax was introduced by the government to discourage intake of carbonated products like Coca-Cola, Pepsi, Sprite and other sweetened beverages that are associated with excessive sugar related sickness like obesity and diabetes.

According to reports, about four million Nigerians suffer from diabetes linked to excess sugar consumption. She emphasised that the major focus of the government is to complete ongoing and new projects across the country.

The minister made the disclosure today at the presentation of the 2022 budget breakdown in Abuja. The new tax law is contained in the government’s 2021 Finance Act.

The government considers the new measure as one of its 2022 budget priorities that help to raise more revenue for health-related and other critical expenditures.

The  minister said  Federal Government independent revenue surpassed the N1 trillion mark for the first time.

Independent revenue is a stream of income received without directly exchanging labour-power for it. These include interest on money capital, dividends earned by share ownership, rental income, etc.

The minister said the government raked in N1.104 trillion as at November 2021.

Ahmed disclosed this on Wednesday during a public presentation of the 2022 approved budget in Abuja.

Ahmed said despite the doubts from analysts on the improvement of the federal government independent revenue, the administration has been able to do much than expected.

“We have now for the first time surpassed the one trillion mark collection for independent revenues. N1.104 trillion was collected as at November 2021 against a budget target of N973.41 billion,” the minister said.

“Analysts have always considered our projections unrealistic, but we have always insisted on the potentials that exist to grow FGN independent revenues.

“The steady improvement of our independent revenues over the years …reflects the performance of our growth initiatives.”

Ahmed said that revenue generation is the major challenge facing the nation.

“Several measures are being instituted under the administration’s Strategic Revenue Growth Initiatives to improve government revenue and entrench fiscal prudence with emphasis on achieving value for money,” Ahmed added.

“These measures include improving the tax administration framework including tax filing and payment compliance improvements. Identify and plug existing revenue leakages to enhance tax compliance and reduce tax evasion. Leverage technology and automation and also plugging fiscal drainers like subsidiaries.”

The minister added that the government will impose excise duty on carbonated drinks to encourage healthy living.

She emphasised that the major focus of the government is to complete ongoing and new projects across the country.