Hike in excise duty on tobacco, alcohol will reduce abuse, disease – CPC

Minister of Finance, Kemi Adeosun
Minister of Finance, Kemi Adeosun

‎The Consumer Protection Council (CPC) said on Tuesday the federal government’s proposed increase in excise duty on alcoholic beverages and tobacco products would reduce risk of diseases.

Besides, the council said, government’s decision to grant consumers a 90-day moratorium and periodic incremental adjustments to ensure appropriate balance between personal consumer choices and public interest was a step in the right direction.

The new excise duty rates announced on Sunday by the Minister of Finance, Kemi Adeosun, will help raise government’s revenues and reduce the health hazards associated with tobacco and alcohol abuse, the council said.

Mrs. Adeosun said the increment to be spread over a three-year period between 2018 and 2020 would also help moderate the impact on prices of the products.

Under the new rates, each stick of cigarette would attract a N1 specific rate per stick (or N20 per pack of 20 sticks) in 2018; N2 specific rate per stick (or N40 per pack of 20 sticks) in 2019, and N2.90k specific rate per stick (or N58 per pack of 20 sticks) in 2020.

Similarly, the new specific excise duty rate for alcoholic beverages cuts across beer & stout, wines and spirits for the three year period.

Accordingly, beer and stout would attract N0.30k per centilitre in 2018 and N0.35k per centilitre each in 2019 and 2020.

Again, wines would attract N1.25k per centilitre in 2018; N1.50k per centilitre each in 2019 and 2020, while N1.50k per centilitre was approved for Spirits in 2018; N1.75k per centilitre in 2019 and N2.00k per centilitre in 2020.

In a statement sent to PREMIUM TIMES on Tuesday, the Director General of the CPC, Babatunde Irukera, said the decision to increase the excise duty on these commodities was consistent with prevailing global practices.

Although he said CPC’s mandate was to protect the rights of all consumers, Mr. Irukera said consumers still have the prerogative to make personal lifestyle choices.

“We encourage responsible consumption in all circumstances, particularly of products that may potentially have adverse effects, or possibly modify behaviour in a fashion that may be harmful or inconvenient to the consumer, or others,” he said.

“We (CPC) believe government’s motivation to increase the duty was the desire to reduce the risks of abuse and disease that may be associated with consumption of these products”, Mr. Irukera said.

He said he was convinced government’s approach would foster consumer confidence, provide regulatory clarity and prioritise safety, to reinforce the mandate of the council.

“The council insists all producers, particularly of the products subjected to the revised excise duty, must take appropriate steps, including full disclosures, to promote responsible consumption, responsive, transparent and accessible consumer complaint resolution mechanisms to protect and satisfy consumers,” he said.

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