Tax Bites series

Latest Tax Bites issue:

A review of the Excise Duty (Non-Alcoholic, Carbonated and Sweetened Beverages) Regulations, 2022

The Finance Act 2021 (“Finance Act”) amended the Customs, Excise Tariffs, etc (Consolidated) Act, 2004 (“CETA”) by introducing a new section 21(3) to CETA .

This new subsection imposed an excise duty of N10 per litre on non-alcoholic, carbonated and sweetened beverages.

According to the Federal Government, the introduction of the excise duty is to discourage excessive consumption of sugar in beverages which contributes to a number of health conditions including diabetes and obesity.

This excise duty, otherwise known as the “Sugar tax” was also introduced to generate revenues for health-related and other critical expenditures. Even though the effective date of commencement of the Finance Act is January 2022, the implementation of this excise duty did not commence until 1 June 2022. On 12 September 2022, the Minister of Finance, Budget and National Planning, in exercise of the powers conferred by virtue of section 120 of the Customs and Excise Management Act 2004 (“CEMA”), signed a Regulation titled Excise Duty (Non-Alcoholic, Carbonated and Sweetened Beverages) Regulations, 2022 (“Regulations”) for the effective administration of the excise duty.

This publication seeks to analyse the Regulations and its attendant implications.