The National Union of Food, Beverage and Tobacco Employees (NUFBTE) has urged the House of Representatives to reject the proposed amendment to Nigeria’s soft drinks tax, warning that it could lead to factory closures, job losses and further challenges for the manufacturing sector.
The appeal was contained in an open letter addressed to the Speaker of the House of Representatives, Tajudeen Abbas, and co-signed by the union’s President, Garba Dankama.
The proposed legislation, known as the Customs, Excise Tariff, etc. (Consolidation) Act (Amendment) Bill, 2025, passed its third reading in the Senate on June 4, 2026, and is currently awaiting concurrence by the House of Representatives.
Dankama expressed concern over the deteriorating operating conditions in Nigeria’s manufacturing sector, noting that high borrowing costs, rising energy and logistics expenses, foreign exchange constraints and declining consumer purchasing power have forced several manufacturers to scale back production or shut down operations.
He warned that introducing an additional tax burden on the non-alcoholic drinks (NAD) sector could worsen the situation, given its extensive linkages with agriculture, transportation, distribution and retail.
The union president also questioned the potential public health benefits of the proposed tax, arguing that soft drinks account for a relatively small proportion of Nigerians’ total sugar consumption.
He maintained that increasing taxes on the products could encourage consumers to switch to cheaper, unregulated alternatives while threatening employment across the industry’s value chain.
Dankama further argued that workers’ earnings have failed to keep pace with rising transportation, food and housing costs following the Federal Government’s fuel subsidy removal and foreign exchange reforms.
The Customs, Excise Tariff, etc. (Consolidation) Act (Amendment) Bill, 2025, seeks to replace the existing fixed excise duty of N10 per litre on sugar-sweetened beverages with a percentage-based levy calculated on their retail prices.
It also seeks to provide funding for health insurance coverage for vulnerable Nigerians.
In exclusive interviews with Nairametrics, industry stakeholders, including the Abuja Chamber of Commerce and Industry (ACCI), the Nigeria Employers’ Consultative Association (NECA) and the Manufacturers Association of Nigeria (MAN), raised concerns about the proposed changes.
They argued that replacing the existing fixed levy with a percentage-based tax could increase production costs, discourage investment and place additional pressure on manufacturers already facing difficult operating conditions.
The proposed amendment to Nigeria’s soft drinks tax is aimed at reducing the growing burden of non-communicable diseases (NCDs), including diabetes, obesity, hypertension and cardiovascular diseases, which health experts have linked to unhealthy diets and excessive sugar consumption.
The ministry’s 2025 State of Health of the Nation Report also estimated that at least 40% of Nigerian adults were living with hypertension.
These figures highlight the growing burden of non-communicable diseases and the concerns driving calls for policies to discourage excessive sugar consumption.
