FG Begins Implementation Of New Excise Duties On Alcohol, Tobacco

President Buhari’s Democracy Day Address (FULL TEXT)
File photo: President Muhammadu Buhari

 

The Federal Government will today begin the implementation of the new excise duties for alcohol and tobacco.

President Muhammadu Buhari had in March assented to an increase in excise duties for tobacco, beer, wine, and spirits imported permitting a grace period of 90 days for implementation.

This follows after the Minister of Finance, Kemi Adeosun wrote to President Buhari to seek approval of the excise review.

The Minister stated that Adeosun noted that the reviews would be from 2018 to 2020 in order to reduce an expected negative impact on the sector.

According to her, the health hazards associated with tobacco-related diseases and alcohol abuse will be reduced.

“The Tariff Technical Committee (TCC) recommended the slight adjustment in the excise duty charges after cautious considerations of the government’s fiscal policy measures for 2018 and the reports of the World Bank and the International Monetary Fund Technical Assistance Mission on Nigeria’s fiscal policy.

“The effect of the excise duty rates adjustment on trade and investment was also assessed by the Federal Ministry of Trade and Investment and it adopted the recommendations of the TTC.

“Peer country comparisons were also carried out showing Nigeria as being behind the curve in the review of excise duty rates on alcoholic beverages and tobacco.”

The upward review of the rates was carried out in line with new ECOWAS standards and is expected to boost the government’s revenue and discourage abuse of the items.

 

Buhari Approves New Excise Duty Rates For Alcoholic Drinks, Tobacco

Buhari Approves New Excise Duty Rates For Alcoholic Drinks, Tobacco
File photo: President Muhammadu Buhari

 

President Muhammadu Buhari has approved an amendment to the excise duty rates for alcoholic beverages and tobacco with effect from Monday, June 4, 2018.

The President also granted a grace period of 90 days (three months) to all manufacturers before the commencement of the new excise duty regime.

Minister of Finance, Mrs Kemi Adeosun, who revealed this on Sunday in Abuja, however, said there was no increase in excise duty of other locally excisable products.

She explained that the new excise duty rates were spread over a three-year period from 2018 to 2020, in order to moderate the impact on prices of the products.

The Minister disclosed that the new excise duty regimes followed all-inclusive stakeholder engagements by the Tariff Technical Committee of the Federal Ministry of Finance with key industry stakeholders.

According to her, the upward review of the excise duty rates for alcoholic beverages and tobacco was to achieve a dual benefit of raising the government’s fiscal revenues and reducing the health hazards associated with tobacco-related diseases and alcohol abuse.

“The Tariff Technical Committee (TCC) recommended the slight adjustment in the excise duty charges after cautious considerations of the government’s Fiscal Policy Measures for 2018 and the reports of the World Bank and the International Monetary Fund Technical Assistance Mission on Nigeria’s Fiscal Policy,” Adeosun said in a statement by her media aide Oluyinka Akintunde.

“The effect of the excise duty rates adjustment on trade and investment was also assessed by the Federal Ministry of Trade and Investment and it adopted the recommendations of the TTC.

“Furthermore, peer country comparisons were also carried out, showing Nigeria as being behind the curve in the review of excise duty rates on alcoholic beverages and tobacco,” she added.

Following the President’s approval, the minister revealed that the new excise duty rate on tobacco was a combination of the existing ad-valorem base rate and specific rate while the ad-valorem rate was replaced with a specific rate for alcoholic beverages.

She added, “For alcoholic beverages, the current ad-valorem rate will be replaced with specific rates and spread over three years to moderate the impact on prices. This will curb the discretion in the Unit Cost Analysis (UCA) for determining the ad-valorem rate and prevent revenue leakages.

“For Tobacco, the government will maintain the current ad-valorem rate of 20 per cent and introduce additional specific rates with the implementation to be spread over a three-year period to also reasonably reduce the impact on prices.”

Under the newly approved excise duty rates for tobacco in addition to the 20 per cent ad-valorem rate, each stick of cigarette will attract a N1 specific rate per stick (N20 per pack of 20 sticks) in 2018, N2 specific rate per stick (N40 per pack of 20 sticks) in 2019 and N2.90k specific rate per stick (N58 per pack of 20 sticks) in 2020.

Adeosun further explained that Nigeria’s cumulative specific excise duty rate for tobacco was 23.2 per cent of the price of the most sold brand, as against 38.14 per cent in Algeria, 36.52 per cent in South Africa and 30 per cent in the Gambia.

The new specific excise duty rate for alcoholic beverages cuts across beer and stout, wines and spirits for the three years 2018 to 2020.

Under the new regime, beer and stout would attract N0.30k per centilitre (Cl) in 2018 and N0.35k per Cl each in 2019 and 2020.

Wines would attract N1.25k per Cl in 2018 and N1.50k per Cl each in 2019 and 2020, while N1.50k per Cl was approved for spirits in 2018, N1.75k per Cl in 2019 and N2.00k per Cl in 2020.

The Minister added that the new excise duty regimes are in line with the Economic Community of West African States (ECOWAS) directive on the harmonisation of member-states’ legislation on excise duties.

The ECOWAS Council of Ministers had during its 62nd and 79th Ordinary Sessions in Abuja in May 2009 and December 2017, respectively, issued directives on the harmonisation of the ECOWAS Member States’ Legislations on Excise Duties.

The directives seek to harmonise member-states’ legislation on excise duties of non-oil products and stipulate the scope of application, the rate of taxation, taxable event and amount.

 

BREAKDOWN OF THE NEWLY APPROVED EXCISE DUTY RATES

 

YEAR

TOBACCO

BEER

 

WINE

SPIRITS

Naira Per Stick

Naira Per Cl

 

Naira Per Cl

Naira Per Cl

2018

Ad-valorem Rate of 20% + N1 specific rate per stick

0.30

1.25

1.50

2019

Ad-valorem Rate of 20% + N2 specific rate per stick

0.35

1.50

1.75

2020

Ad-valorem Rate of 20% + N2.90k specific rate per stick

0.35

1.50

2.00

I Love My People, I Have No Intentions Of Promoting Tobacco-Olamide

Singer and songwriter Olamide has responded to the news that went viral on Friday saying he was promoting tobacco in his music video.

The rapper took to his Twitter page on Tuesday and he cleared the air.

He said, “No intentions of promoting tobacco to get people killed, I love my people, I love my country, one love, one Nigeria #ClearTheAir 🇳🇬Oya Wo.”

This is in response to the post the Ministry of Health had on their page on Friday calling out the artiste that his music video contained scenes that violated the Tobacco Control Act 2015 and that it encouraged second-hand smoking.

However, Olamide and the Ministry of Health had a conversation which hence led to Olamide’s post.

In response to Olamide’s post, The Ministry of Health appreciated the rapper’s response and also stated that  It is not in their mandate to ban music.

“Thank you rapper Olamide for your response. We respect this heart for the health of the people and your fans. Responsibility!

“We are in the business of public health promotion. It is not in our mandate to ban music. We thank Olamide for his cooperation. One Nigeria.”

The reports which have now be declared false claimed that Davido’s ‘Fall’ and ‘If’ remix with R Kelly,Olamide’s ‘Wavy Level ‘and ‘Wo’, 9ice’s ‘Living Things’ were banned.

FG Plans Ban Of Tobacco Sale To People Under 18

FG Plans Ban Of Tobacco Sale To People Under 18
File Photo

The Federal Government has announced plans to ban the sale of tobacco products to anyone under the age of 18 across Nigeria.

The Minister of Health, Professor Isaac Adewole, disclosed this at a news conference to mark the 2017 World No-Tobacco Day in Abuja, the Federal Capital Territory.

Professor Adewole decried the lack of enforcement of the National Tobacco Control Act, two years after it was enacted in 2015.

According to him, the population of tobacco users in the country has continued to rise, even in the face of the National Tobacco Control Act.

Statistics by the World Health Organisation, which set aside May 31 of every year to create awareness on the dangers of tobacco usage, highlight a high death rate among smokers.

According to WHO, over 600 million people die annually from the use of tobacco across the world, while over 80% of such deaths are from low and medium income earning nations like Nigeria.

WHO Country Representative, Wondi Alehu, who also spoke at the conference, urged the government to ensure proper legislation for tobacco control in Nigeria.

A pathologist at the National Hospital, Abuja, Dr. Henry Ewunonu, noted that the use of tobacco is a leading cause of cancer and other skin diseases.

Despite the enactment of the law, the Ministry of Health said over 20 billion sticks of cigarettes are still being consumed in Nigeria.

The Nigeria 2012 Adult Tobacco Survey also reveals that 4.5 million adults in Nigeria use tobacco out of which 4.1 million are men, while another 6.4 million none smokers are exposed to second-hand smoking and its hazards.

Do What Is Right And Safe For Customers, Fashola Urges Tobacco Company

Lagos State Governor, Mr Babatunde Fashola (SAN) on Monday received the management of British American Tobacco Company on a courtesy visit, commending the company’s investment in Nigeria even as he urged the organization to do business with very strong conscience about what is right and what is safe for the consumers.   

The Governor who spoke at the Lagos House, Ikeja  when he received the team led by the Managing Director, Mr Keith Gretton said a company like the British American Tobacco Company should be thinking about how it can better prolong the lives of the people for whom it also make products.

“I think that an organization like yours should be able think of how they can better prolong the lives of the people for whom, you also make products and now, we are seeing a lot of diseases today as a result of lifestyle choices and lifestyle issues and they are getting much more complex with substance dependency and so on and so forth”, the Governor said.

According to Governor Fashola, “The organization should stand up to be counted in terms of advancing regulations pertaining to its products. These are places where I would strongly think that your organization put a strong foot forward in terms of full appreciation of the need to intervene in advance of regulation as it were because I know that the lifestyle choices that people make especially in the kind of products that you make can also have certain health consequences and I think that it is important to help people to promote the risk voluntarily and openly in a manner that people therefore know what choices they have”, he reiterated.

The Governor said it was refreshing to learn about investments being made in the  Nigerian market and also the indicators of further commitments being made  by the organisation, adding that the benefits in terms of employment to people also come comes clearly across, adding that the administration will also continue to play its part in terms of infrastructure support.

“We as a government remain committed to supporting businesses by filling in with the hardware end of the matter such as infrastructure, security and also continue to provide the environment in which your human capital can thrive and prosper”.

Governor Fashola said in the area of security, the State Government encourages institutions such as Foundations like that of the British American Tobacco Company to look at the bouquet of opportunities to support the State Security Trust Fund which is an entirely voluntary venture that helps the State to resource the security personnel in the state in terms of equipment, vests, boots, patrol vehicles and so on.

He reiterated that whatever support that is given is not only well received but is accounted for as the Trust Fund holds annual General Meetings and yearly publishes the list of the donors since 2008 without failing.

According to the Governor, the donations have helped in providing some structure around which the resource management and logistics of the federal controlled but state deployed Police is managed, saying it is something he will commend support for the Security Trust Fund to the company as a matter of sensible self interest.

Speaking earlier, the Managing Director, Mr Keith Gretton had commended the infrastructure regeneration work which the Governor Fashola led administration is doing in Lagos State as well as the widely acknowledged security sector in the state.

He added that over the years the British American Tobacco Company West Africa has become a vital business for BAT globally with Nigeria being one of the top ten globally out of 180 countries where BAT is present.

Mr. Gretton stressed that the company is involved in some agriculture programme in Lagos and has about three to four ongoing projects at various stages helping women and the youth. 

The Governor was joined by some members of the State Executive Council including the Commissioner for Commerce and Industry, Mrs Sola Oworu, Finance, Mr Ayo Gbeleyi, Economic Planning and Budget, Mr Ben Akabueze, and Special Adviser on Revenue and Taxation, Mr Bola Shodipo while those on the entourage of the Managing Director of British American Tobacco Company include the Head, Corporate Regulatory Affairs (West Africa), Mr Freddy Mensahvi, and Legal Director (West Africa), Mrs Sade Morgan among others.