Muda Yusuf says taxing sweetened beverages could hurt jobs and manufacturing while delivering limited health benefits
The Centre for the Promotion of Private Enterprise (CPPE) has cautioned the Federal Government against introducing additional taxes on sugar-sweetened beverages, warning that such a move could weaken Nigeria’s manufacturing base and threaten jobs without meaningfully addressing public health concerns.
In a statement issued on Wednesday, CPPE’s Chief Executive Officer, Dr Muda Yusuf, said available evidence suggests that sugar taxes offer only limited health benefits unless they are complemented by broader lifestyle and behavioural interventions.
According to the organisation, key drivers of diabetes and other non-communicable diseases in Nigeria include poor diet quality, physical inactivity, sedentary lifestyles, urban design challenges and genetic factors.
“While taxation may have a marginal impact on consumption, it does not tackle the root causes of these health challenges,” Yusuf said, adding that the economic consequences of imposing additional taxes would be “immediate, tangible and potentially severe.”
Instead of introducing new levies, the CPPE urged policymakers to prioritise preventive and health-focused strategies such as nutrition and lifestyle education, community-based awareness programmes, promotion of regular physical activity, increased consumption of fruits and vegetables, healthy food subsidies, and urban planning that supports walking and cycling.
“These approaches directly address the underlying causes of diabetes and cardiovascular diseases, generate broader social benefits and avoid undermining a vital pillar of Nigeria’s manufacturing and employment ecosystem,” Yusuf stated.
The group criticised renewed calls for higher taxes on sugar-sweetened non-alcoholic beverages, describing the proposal as “misplaced, economically risky and weakly supported by empirical evidence.”
While acknowledging the growing burden of diabetes and cardiovascular diseases, Yusuf said sugar taxation does not reflect Nigeria’s current structural and macroeconomic realities, particularly at a time of high inflation, weakened purchasing power and fragile industrial recovery.
He also argued that advocacy for sugar taxes in Nigeria is largely influenced by “externally derived policy templates,” noting that global experience does not support sugar taxation as a sustainable or standalone solution to non-communicable diseases, especially in developing economies.
The CPPE stressed that the food and beverage industry remains the backbone of Nigeria’s manufacturing sector. Citing data from the National Bureau of Statistics, the organisation said the sector accounts for about 40 per cent of total manufacturing output, with the non-alcoholic beverage segment playing a critical role in industrial growth, employment and value creation.
According to the group, the industry supports a vast value chain that includes farmers, agro-input suppliers, processors, packaging firms, logistics operators, wholesalers, retailers and the hospitality sector, sustaining millions of livelihoods nationwide.
It warned that policies that weaken the sector could result in job losses, reduced household incomes, lower investment and setbacks to poverty reduction efforts.
The CPPE also noted that beverage manufacturers are already among the most heavily taxed businesses in the country. Existing obligations include 30 per cent Company Income Tax, 7.5 per cent Value Added Tax, a ₦10 per litre excise duty, a four per cent National Development Levy, a four per cent FOB levy on imported inputs, import duties ranging from five to 15 per cent on raw materials, a 0.5 per cent ECOWAS levy, property taxes and multiple state and local government charges.
Yusuf said these pressures are further compounded by high energy and logistics costs, exchange rate volatility and elevated interest rates, all of which have driven up production expenses and consumer prices.
He added that retail prices of many non-alcoholic beverages have increased by about 50 per cent over the past two years, even without the introduction of new taxes.
The CPPE concluded that Nigeria’s economy remains in a delicate recovery phase, warning that the introduction of sugar-specific taxes at this time could reverse recent industrial gains and weaken employment.
The organisation stressed that public health objectives and economic growth are not mutually exclusive, calling on the government to pursue “balanced, holistic and development-conscious policymaking.”
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