A federal high court in Abuja has ruled against the excise duty on carbonated drinks introduced by federal government, declaring it invalid.
Gatekeepers News reports that Nigeria Employers’ Consultative Association (NECA) announced this in a statement on Monday.
This followed a suit filed in 2022 by NECA after federal government introduced an excise duty of N10 per litre on nonalcoholic, carbonated, and sweetened beverages.
The tax was meant to discourage excessive consumption of sugar beverages which is said to contribute to diabetes, obesity, and other health issues.
NECA, representing the interests of businesses, challenged the circular, arguing that it was unjustifiable.
The defendants in the suit are Wale Edun, minister of finance, and Bagudu, the minister of budget and national planning.
NECA said the presiding judge, Justice O.A. Egwuatu rejected the preliminary objection of the Ministry of Finance due to lack of merit, following three years of intense legal proceedings.
The statement reads, “Delivering judgment on the substantive case, the court held in summary that the circular issued by the 2nd Defendant (Federal Ministry of Finance) is invalid and ultra-vires stating that the powers of the 2nd Defendant; and the 1st Defendant (the Customs Service) is not entitled to demand transport and feeding allowances from the plaintiffs (NECA members).”
“The court further declared that the circular entitled “Approval for the Implementation of
2022 Fiscal Policy Measures and Tariff Amendments,” dated March 1, 2022 issued by the 2nd Defendant (Honourable Minister of Finance, Budget and National Planning) is invalid and ultra-vires the powers of the 2nd Defendant.”
Adewale Smatt-Oyerinde, the director-general of NECA, described the judgement as a victory for organised businesses in Nigeria against “official arbitrariness and unfortunate attempts to impose additional burdens on businesses.”
