CPPE: Senate Passage of SSBs Bill Could Turn into a Tax on Production, Investment, and Employment

–         Urges House of Representatives to reject the bill 

Dike Onwuamaeze 

The Centre for the Promotion of Private Enterprise (CPPE) has expressed shock and deep concern over the Senate’s passage of the Sugar‑Sweetened Beverage Tax Bill, which it described as anti‑growth and potentially a tax on production, investment and employment.

The bill, as passed by the Senate, proposes replacing the current flat N10‑per‑litre excise duty on non‑alcoholic SSBs with a percentage‑based levy tied to the prevailing retail price of these products.

The legislation also earmarks a portion of the revenue from the excise duty for health promotion and disease prevention.

CPPE said it was shocked that the Senate would pass the bill despite overwhelming objections from private‑sector stakeholders, particularly the Manufacturers Association of Nigeria (MAN).

It therefore urged the House of Representatives to decline concurrence with the bill.

CPPE stated: “The proposed legislation is fundamentally anti‑growth. It penalises production, discourages investment, threatens jobs and imposes additional costs on already burdened consumers.”

“The House of Representatives has historically demonstrated sensitivity to the welfare of citizens and the concerns of productive enterprises.”

“We urge members to uphold that tradition by rejecting this legislation in the interest of manufacturing sustainability, employment preservation, investment confidence and policy coherence.”

“At a time when businesses and households are struggling with unprecedented cost pressures, the economy needs relief, not additional taxation; support for production, not policies that weaken enterprise; and reforms that create jobs, not measures that put them at risk.”

These views were expressed yesterday by CPPE Chief Executive Officer Dr. Muda Yusuf in a public statement titled “CPPE Urges House of Representatives to Reject Sugar Beverage Tax Bill.”

Yusuf said the bill seeks to impose an additional layer of taxation on non‑alcoholic beverage manufacturers, thereby worsening cost pressures across the value chain at a time when the federal government’s policies focus on easing the cost of doing business and revitalising manufacturing.

He added: “The bill is ill‑timed, insensitive to prevailing economic realities, and inconsistent with the federal government’s commitment to reducing the tax burden on businesses.”

“At a time when manufacturers are grappling with elevated energy costs, high interest rates, exchange rate pressures, logistics challenges, weak consumer purchasing power and multiple taxes and levies, the imposition of an additional excise tax on non‑alcoholic beverages would further erode industrial competitiveness and weaken investment prospects.”

Yusuf also said the SSB bill threatens manufacturing, jobs and value‑chain development, noting that the food and beverage subsector is one of the strongest pillars of Nigeria’s industrial economy, accounting for a significant proportion of manufacturing output and jobs.

He explained that the subsector’s extensive linkages with agriculture, packaging, logistics, retail trade, hospitality and distribution make it a powerful engine of inclusive economic activity.

“The non‑alcoholic beverages subsector is a major contributor to this ecosystem and should be supported, not burdened with additional taxation.”

“Any additional tax burden on the industry would inevitably increase production costs, raise consumer prices, weaken demand, reduce capacity utilisation and threaten jobs across the value chain.”

“At a time when the economy needs stronger industrial growth, this Senate proposal risks becoming a tax on production, investment and employment,” he said.

Yusuf highlighted the apparent policy inconsistency inherent in the bill, arguing that its content runs contrary to the spirit of ongoing fiscal and tax reforms designed to create a more investment‑friendly business environment.

He noted that “the 2026 fiscal policy framework already provides for an excise duty of ₦10 per litre on non‑alcoholic beverages.”

He argued that “further escalation of the tax burden through additional legislation would create policy inconsistency, heighten regulatory uncertainty and undermine investor confidence.”

CPPE said that investments thrive on predictability and warned that frequent additions to the tax burden would send the wrong signal to both existing and prospective investors.

Although Yusuf recognised the importance of addressing the growing incidence of diabetes and other non‑communicable diseases in the country, he contended that available evidence suggests that sugar taxes, on their own, deliver limited public health outcomes.

The major drivers of diabetes and related health conditions in Nigeria include poor dietary habits, excessive consumption of carbohydrate‑rich foods, physical inactivity, sedentary lifestyles, inadequate health awareness and genetic predisposition. Taxation does little to address these underlying factors. What it achieves is an immediate increase in production costs, higher consumer prices and additional pressure on investment and employment.

He said: “If the objective is to improve public health outcomes, lawmakers should prioritise legislations that directly address the root causes of lifestyle‑related diseases.”

“These include nutrition education, public health awareness campaigns, promotion of exercise and physical activity, encouragement of healthier food choices, improved preventive healthcare systems, and urban planning that supports active living through walking and cycling infrastructure.”

“Such interventions are more sustainable, more inclusive and less damaging to economic activity than punitive taxation targeted at a major manufacturing subsector.”

“Public health goals should not be pursued through policies that inadvertently weaken production, investment and job creation.”

Yusuf posited that public health objectives and economic growth are not mutually exclusive. He said that Nigeria can pursue both through policies that promote healthier lifestyles while protecting investment, jobs and industrial development.

“The Sugar‑Sweetened Beverage Tax Bill fails this test and should therefore be rejected in its entirety,” Yusuf said.