New excise duty hike a threat to local alcohol industry says DIBAN Chairman
The Distillers and Blenders Association of Nigeria (DIBAN) made it public that it has rejected the rise in excise duty being imposed on domestic wines and spirits. This is coming as the Federal Government commences the implementation of the tax hike.
Addressing the newsmen on Wednesday in Lagos, Chief Patrick Anegbe, the Chairman of DIBAN, declared that the hike was a threat to the N420 billion investment of the industry.
According to him, there was no prior engagement/consultation whatsoever with the indigenous producers of wines and spirits, before adopting the hike. Also, the association was particularly worried that the job of over 25,000 Nigerians and over 250,000 connected SMEs staff were being threatened by the new approach.
He said “We Distillers and Blenders Association of Nigeria (DIBAN), under the auspices of the Manufacturers Association of Nigeria (MAN) reject the new astronomical hike in excise duty being selectively imposed on the domestic wines and spirits, one of the oldest and driving indigenous industries in Nigeria. For the record, the new duty approved for implementation by the Honourable Minister of Finance, translates to an increase in duty from the current average of N30 per litre to N150 in the first year and N200 per litre subsequently.
“This translates to an increase from current average duty of N270 to N1,350 per case (carton) in the first year and N270 to N1,800 per case from second year. This is an increase of over 500 per cent purely on local wines and spirits with the exclusion of all imported wines, spirits and champagne. We reject in totality, the highly punitive and selective astronomical hikes in duty, a purely IMF agenda being camouflaged as a health concern”.
The chairman said that the excise duty increase was an attempt by the minister to foist an IMF sponsored agenda on Nigeria, which would further compound the hardship of already impoverished Nigerians.
He said that if the implementation of the new duty hike was allowed to proceed, it would lead to obvious job losses that would result from low demand of the products.
According to him, the new hike will lead to the collapse of the indigenous wines and spirits segment and pave way for the complete takeover of the market by the imported and smuggled brands.
”For the sake of emphasis, from a recent study carried out by KPMG, it was concluded that price elasticity holiday spirits/wines segment is very high such that a 10 per cent increase in price of wine will lead to about 20.9 per cent fall in demand. Mobile casinos are super reasonable because people can play them anywhere. You can discover the rating of reliable mobile gambling sites in India. Casinomech.net has tips about the best casino apps and websites.
”A 19 per cent increase in the price of spirit will result in a 41 per cent decline in volume and this is predominant in the low price segments which represent 78.65 per cent of the total volume.
Anegbe said that the association was not against moves by government to increase fiscal revenue.
He however, said that for governments to achieve its revenue generation plan, continued existence of the indigenous low-priced segment players was very critical.
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