CAPPA demands probe of export expansion grant to tobacco firms

By : Innocent Anoruo

Date: 2 December 2023 3:49am WAT

A picture taken on September 29, 2017 shows a close up shot a stack of cigarettes in Kuwait City. On October 1, 2017, the United Arab Emirates will double the price of tobacco and increase soft drink prices by 50 percent, ahead of a more general tax on goods and services on January 1 next year. It is but one of the six Gulf Cooperation Council states -- along with Saudi Arabia, Bahrain, Kuwait, Oman and Qatar -- to introduce the five-percent VAT next year as they seek to redress their economies. / AFP PHOTO / Yasser Al-Zayyat

Corporate Accountability and Public Participation Africa (CAPPA) has called on Federal Government to extend the planned probe of tax waivers, grants and other insidious benefits unduly awarded to corporations by past governments to include the Export Expansion Grant (EEG) awarded to tobacco companies.

The EEG scheme is a post-shipment incentive introduced by the Federal Government to encourage indigenous exporters to expand their export volume and value in the global market.

CAPPA made the call in a statement, yesterday, by its Policy and Research Officer, Zikora Ibeh, in reaction to the resolution of the House of Representatives to investigate all tax waivers granted since 2015, and the candid observations of the Chairman, Presidential Committee on Tax Reforms and Fiscal Policy, Mr. Taiwo Oyedele.

The chairman had declared, in a recent television interview, that the country’s administration of tax waivers was lacking in both prudence and transparency.

Welcoming the probe, CAPPA urged the government to extend its investigative search to the sleazy waivers granted to the tobacco industry since 2003. It declared that the waivers, benefits and recognition granted to the tobacco industry were further complicated by the multi-faceted impact of the tobacco industry on public health and the environment.

Executive Director of CAPPA, Akinbode Oluwafemi, said: “We demand full and transparent inquiry into these shady waivers that have ripped the country of its revenues. More so, we are concerned about the benefits awarded to the tobacco industry under the EEG scheme, and other untoward agreements that insult every Nigerian striving for a healthier and more equitable society.

“These waivers and grants not only undermine our country’s fiscal responsibility, but also tacitly endorse an industry that poses significant health risks, affecting many Nigerians.”

According to CAPPA, global health bodies, scientific and medical research have consistently highlighted the severe health implications of tobacco consumption, linking it to a host of chronic diseases including cancer, heart diseases and respiratory illnesses.

Oluwafemi added: “By exempting the tobacco industry from its fair share of taxes, the Nigerian government inadvertently compromised public health in the country and other West African countries and widened the country’s poverty gap.

“This preferential treatment granted to an undeserving industry deprives the nation of crucial revenue needed for public services like healthcare, education and infrastructure development.”