The Centre for the Promotion of Private Enterprise (CPPE) has expressed concern over what it called renewed calls for the imposition of additional taxes on sugar-sweetened non-alcoholic beverages.

Nigeria has just introduced a new set of tax laws, which are currently facing pushback from citizens who believe the new regime will worsen their tax burden.

The Centre noted that while public health challenges such as diabetes and cardiovascular diseases undoubtedly warrant urgent attention, the proposition of a sugar-specific tax is misplaced, economically risky and weakly justified.

CPPE, in a statement signed by its Chief Executive Officer, Dr Muda Yusuf, and released yesterday, said Nigeria’s economy remained in a delicate recovery phase.

It noted that advocacy for sugar taxation is largely driven by an externally-motivated policy template, particularly those associated with global health institutions.

“However, global best practice does not support sugar taxation as a sustainable or standalone solution to non-communicable diseases – especially in economies characterised by high inflation, weak purchasing power, fragile industrial recovery and widespread poverty, such as Nigeria,” it said.

It added that it was not adequately contextualised within Nigeria’s prevailing structural, social and macroeconomic realities. It said Nigeria’s food and beverage industry remains the largest and most dynamic segment of the manufacturing sector, with the non-alcoholic beverages sub-sector playing a particularly significant role.

“Data from the National Bureau of Statistics (NBS) indicate that the food and beverage industry contributes approximately 40 per cent of total manufacturing output, making it a critical driver of industrial growth, employment and value creation.

“Beyond factory-level operations, the sector sustains an extensive value chain that spans farmers, agro-input suppliers, processors, packaging companies, logistics providers, wholesalers, retailers, and the hospitality industry.

“Collectively, these activities support millions of livelihoods nationwide. Any policy that undermines this sector therefore carries wide-ranging economic consequences, including job losses, declining household incomes, reduced investment, and setbacks to poverty-reduction efforts,” it stated.

CPPE noted that manufacturers of non-alcoholic beverages are among the most heavily taxed and cost-pressured businesses in the Nigerian economy.

“These fiscal pressures are further compounded by Nigeria’s challenging operating environment, including high energy costs, prohibitive logistics expenses, exchange-rate volatility, and elevated interest rates,” it noted, adding: “The cumulative effect has been rising production costs, shrinking margins, subdued investment appetite and higher consumer prices.

“Notably, retail prices of many non-alcoholic beverages have already increased by approximately 50 per cent over the past two years, significantly eroding affordability even in the absence of any new tax measures.”

CPPE said such a tax would only achieve limited public health gains and high economic costs. According to the Centre, “Available evidence suggests that sugar taxes deliver limited public health benefits unless embedded within broader, long-term lifestyle, behavioural and structural interventions.’’

“In Nigeria, the rising incidence of diabetes and related non-communicable diseases is driven primarily by poor overall diet quality, particularly carbohydrate-heavy meals, physical inactivity and sedentary lifestyles as well as urban design that discourages walking and cycling,” it said.