Chief Executive Officer (CEO), Centre for the Promotion of Private Enterprise (CPPE), Dr Muda Yusuf, has rejected the call for additional taxation on sugar-sweetened beverages (SSBs).

The additional taxation is being canvassed by the Corporate Accountability and Public Participation Africa (CAPPA).

Describing the proposal as ill-conceived, poorly timed, and inconsistent with the current administration’s tax reform agenda, which is anchored on reducing the burden of taxation on businesses, improving tax efficiency and stimulating investments, he said as the Nigerian economy was still navigating a fragile recovery, the imposition of new taxes on the manufacturing sector, particularly a highly energy-intensive segment, such as the SSB industry, would be profoundly counterproductive and disruptive to growth, employment and investment.

Speaking through a policy brief yesterday, he noted that businesses were already battling severe cost pressure, just as the Nigerian business environment remained extremely challenging. Listing vulnerability of businesses, he said inflation had remained elevated, significantly eroding consumer purchasing power.

Noting that the SSB industry relied heavily on energy at multiple stages of production, he said the combined burden of soaring energy bills and extremely high distribution costs had significantly worsened the operating environment for beverage manufacturers, further weakening the justification for any additional tax on the sector.

Adding that the prices of beverages and other consumer goods had increased by over 50 per cent in the last two years, he said sales volumes had declined due to weakened consumer purchasing power, adding that many operators, especially small and medium-scale beverage producers, were under existential pressure.

“Imposing additional taxes on an already energy-burdened sector would amount to a punitive layering of fiscal pressure on top of an unprecedented cost crisis, further weakening already fragile business fundamentals,” he said.

According to him, the food and beverage sector is a critical component of Nigeria’s industrial ecosystem and the largest employer in the manufacturing space, adding that it supports an extensive value chain spanning agriculture and raw material supply, manufacturing and processing, logistics and distribution, as well as retail and hospitality.

Acknowledging the rising incidence of non-communicable diseases such as diabetes, he said that taxation of SSBs was not a silver bullet for addressing these concerns.

He urged the government to reject the proposal and the National Assembly to discontinue any legislative consideration of such a tax.

“Public health authorities should prioritise education, prevention and lifestyle interventions. At this critical stage of Nigeria’s economic recovery, the policy imperative should be to support businesses, protect jobs and strengthen growth, not impose additional tax burdens on an already strained sector,” he said.