The Nigerian Customs Service (NCS) has urged the Federal Government to begin the collection of excise duty from carbonated drinks producers in the country such as Coca-Cola, Seven-Up Bottling Company (7up) and others.
The NCS also urged the government to terminate the tax waivers regime granted local companies producing soft drinks in the country.
Comptroller-General, Nigerian Customs Service (CIS). Col Hameed Ali (rtd), stated this yesterday at the stakeholders’ interactive session on the 2021-2023 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) organised by the Senate Joint Committee on Finance and National Planning.
Ali wondered why companies such as Coca Cola, Pepsi cola and other non-alcoholic beverage firms were not paying taxes in Nigeria when they do in other countries where they have operations.
He noted that the defunct Interim National Government of Ernest Shonekan, granted the waivers to the carbonated drinks manufacturers in 1993 to encourage local firms.
He, however, said the policy should no longer be sustained in view of the current reality occasioned by the nation’s dwindling revenue.
Ali said: “We have been pushing for the expansion of our own excise collection. During the Shonekan regime, excise was stopped for carbonated drinks manufacturers like Coca-Cola.
“The only one approved for us are tobacco alcoholic beverages. The understanding then was that tobacco and alcoholic beverages affect the health of citizens and should therefore be taxed.
“But we know that carbonated drinks are also injurious to the health of the people due to the high sugar content.
“Therefore, if tobacco and alcoholic beverages companies are paying tax, the carbonated drink manufacturers should also pay.
“The collection on import will reduce because of the trade agreement we have signed. So, if we don’t expand our excise, the collection from Customs will drop.”
He called on the Federal Government to extend its excise tax net to include carbonated drinks.
He said the action would boost revenue generation since tariff collection on import would drop in 2021 and beyond due to the trade agreement between Nigeria and neighbouring countries.
Ali, however, assured the Senate that the agency would generate N1.2trillion before the end of 2020 because it had already collected N830billion as at the end of July this year.
Senate President, Ahmad Lawan, supported the submissions of Ali and empasised the need for the Federal Government to immediately review the policy so as not to affect the nation’s economy.
Lawan insisted that while the collection of excises from Coca-Cola and others is in order, it should not be an “executive function alone.”
He said: “The executive and the legislature should work together to identify all firms that really deserve waivers because I don’t understand why Coca-cola for instance should not pay excise.
“It is an established company all over the world and it dominates the soft drinks’ industry.
“Unless we are turning ourselves to a country of subsidy for international companies, we should look into it.
“Let us also look at what we have lost over the years. While we are not trying to overburden private companies, we should try and see how to make the economy survive.”
Credit: thenationonlineng.net
