Senate approves new sugar tax regime
The Senate has approved a major overhaul of Nigeria’s sugar-sweetened beverage tax regime, replacing the existing flat-rate excise duty with a price-based levy. The Senate also established a dedicated funding mechanism to support healthcare services and fight non-communicable diseases (NCDs). The decision followed the adoption of the report on the Customs, Excise Tariff (Amendment) Bill, […]
The Senate has approved a major overhaul of Nigeria’s sugar-sweetened beverage tax regime, replacing the existing flat-rate excise duty with a price-based levy.
The Senate also established a dedicated funding mechanism to support healthcare services and fight non-communicable diseases (NCDs).
The decision followed the adoption of the report on the Customs, Excise Tariff (Amendment) Bill, presented by the Chairman of the Senate Committee on Finance, Senator Sani Musa, on behalf of the Joint Committee on Finance, and Customs, Excise and Tariff.
Under the new framework, the current excise duty of N10 per litre on sugar-sweetened beverages will give way to a percentage-based tax linked to retail prices.
The exact rate will be determined by the Minister of Finance in accordance with international best practices and prevailing economic realities.
The upper chamber also approved the creation of a dedicated health fund to be financed from a portion of revenues generated by the new levy.
The fund will support disease prevention programmes, health promotion initiatives, primary healthcare delivery, and expanded health insurance coverage for vulnerable Nigerians.
The Senate noted that the existing volume-based tax structure, introduced several years ago, has been weakened by inflation and no longer provides an effective deterrent against excessive sugar consumption or generates sufficient fiscal returns.
Furthermore, the lawmakers expressed concern over the growing burden of non-communicable diseases across the country—including diabetes, obesity, hypertension, and cardiovascular ailments—many of which have been linked to unhealthy dietary habits and a high intake of sugary drinks.