‘Sin tax’ looms on tobacco and alcohol in Nigeria as fears grow of a public health crisis
Nigeria’s government defied private-sector opposition to impose a new “sin tax” on Monday amid fears that growing tobacco and alcohol consumption could threaten a public health crisis.
Ignoring a last-minute legal challenge, the country’s finance ministry announced that a rise in excise duties had finally come into force, three months after Muhammadu Buhari, the president, was forced by public opposition to delay the hike.
With Nigeria emerging from a painful recession, the new duties will help both to boost revenues and reduce the exchequer’s dependency on the oil sector.
But health campaigners also hope that the taxes will begin to reverse the increasingly deadly habits of a growing number of their countrymen.
Nigerians are Africa’s biggest drinkers, consuming 12.28 litres of alcohol a year per head, according to industry figures. Alcohol consumption is also rising faster in Nigeria than anywhere else on the continent.
Alcohol dependency has led to a rise in non-contagious diseases and has done much to contribute to Nigeria’s grim road safety statistics, medical experts say. Nigeria’s roads are among the most dangerous in Africa, with fatality rates nearly double the global average.
Tobacco is also increasing in popularity. Although the number of women smoking has nearly halved over the past 18 years, the proportion of Nigerian men who have taken up the habit has increased to 17.4 per cent from 11 per cent in 2000, according to World Health Organisation figures.
The finance ministry said it hoped the duties would have “a dual benefit of raising the government’s fiscal revenues and reducing the health hazards associated with tobacco-related diseases and alcoholic abuse.”
But the rises are much more modest than the International Monetary Fund — which had proposed a doubling of tariffs — had called for, and campaigners have questioned how effective they will be.
Taxes on cigarettes will be raised by just four pence a year for the next three years, while alcohol duties are likely to be in a similar range.
Even so, a private sector lobby has threatened to overturn the rises in court.
The Business Renaissance Group is to file a legal challenge arguing that the measures are “selective and arbitrary” because they discriminate against smokers and drinkers as well as threatening the livelihoods of those employed in the tobacco and alcoholic beverage sector. The group said as many as 20,000 jobs could be lost.
But industry experts say that, when it comes to drinking at least, many Nigerians will be unaffected by the new duties. Figures show that home-brewed palm wine, known locally as ogogoro, accounts for up to 84 per cent of all alcohol consumed in Nigeria.
Despite the fondness of some Nigerians for the bottle, figures suggest that fewer Africans drink than Europeans or Americans — although Africans are more likely to engage in bouts of heavy episodic drinking.
Fewer Africans smoke too, but the continent is one of the few places globally where tobacco consumption has risen, despite measures adopted by Nigeria and other countries to ban smoking in public places.
The rise has been attributed to less control on tobacco advertising and a growth in disposable income in the region, experts say. The figures are also rather skewed because Africa’s population has grown faster than in other regions of the world.
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