Dr. Muda Yusuf, Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), has warned that introducing a sugar-specific tax could harm Nigeria’s manufacturing sector and slow economic recovery.
Yusuf described the proposal as “misplaced, economically risky, and weakly supported by evidence,” noting that Nigeria’s economy is still fragile. He said additional taxes could reverse recent industrial gains, weaken employment, and undermine manufacturing-friendly fiscal reforms.
According to him, calls for sugar taxation in Nigeria are largely driven by external policy models that do not reflect the country’s structural and macroeconomic realities, including high inflation, weak purchasing power, and widespread poverty.
While acknowledging rising public health concerns such as diabetes and cardiovascular diseases, Yusuf argued that global best practice does not support sugar taxes as a standalone or sustainable solution, especially in developing economies like Nigeria.
He stressed that public health and economic growth should be pursued together through balanced and development-focused policies, rather than placing further fiscal pressure on manufacturers.
Yusuf noted that Nigeria’s food and beverage industry contributes about 40 per cent of total manufacturing output, making it a major driver of jobs, investment, and value creation. The sector also supports a wide value chain involving farmers, processors, logistics providers, retailers, and hospitality businesses.
He warned that further taxation could lead to job losses, reduced investment, higher consumer prices, and setbacks to poverty reduction.
Yusuf added that beverage manufacturers are already heavily taxed, facing multiple levies including company income tax, VAT, excise duties, import duties, and various federal, state, and local charges, alongside high energy, logistics, and financing costs.
“Additional sugar taxes may slightly affect consumption, but they do not address the root causes of health challenges. The economic damage, however, would be immediate and severe,” he said.
