By Yinka kolawole

The federal government is currently looking into a temporary suspension of the N10 tax on Sweetened Sugar Beverages (SSBs) as part of an economic stabilisation plan. 

Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, disclosed this when he met with the members of the National Action on Sugar Reduction (NASR).

Edun said that the suspension is intended as a temporary relief, with plans to reintroduce the tax once the economy stabilizes.

He compared the arguments against the SSB tax to those made in the past against tobacco taxation, highlighting the importance of data-driven analysis in shaping public policy. According to him, while the government does not support companies selling unhealthy products, it recognizes the need to support businesses and help people cope with the current cost of living.

The minister also emphasized the role of the Presidential Economic Coordination Council on this decision, acknowledging the necessity of government revenue but also the need to offer relief amid economic challenges.

He said: “This measure aims to help beverage companies navigate the current economic difficulties without going under. The temporary suspension of the sugar tax is seen as a measure to stabilise the economy and support the beverage industry during this critical period.

“We support the need for revenue, but we must find a balance. The increase in foreign exchange rates is being passed on to consumers. While the official exchange rate was artificially pegged, products are often priced at the parallel market rate, meaning companies do not pass on the actual exchange rate to customers.”

The federal government implemented a sugary drinks tax to address the increasing levels of obesity and other diseases in the country, following the signing into law of the 2021 Finance Act, which adds N10 per litre to all non-alcoholic and sugar-sweetened beverages (SSBs).