CPPE kicks against proposed sugar tax, warns of economic fallout

The Centre for the Promotion of Private Enterprise (CPPE) has opposed plans to introduce additional taxes on sugar-sweetened beverages, warning that the move could harm Nigeria’s fragile economic recovery.

In a policy brief released on Tuesday, the group rejected recommendations by Corporate Accountability and Public Participation Africa (CAPPA), arguing that new taxes on the beverage sector would contradict the Federal Government’s tax reform agenda aimed at easing business burdens and encouraging investment.

Chief Executive Officer of CPPE, Muda Yusuf, said the proposal was ill-timed, citing the challenging business environment marked by high inflation, rising energy costs, elevated interest rates and exchange rate pressures.

The organisation noted that the beverage industry, being energy-intensive, is already grappling with increased production and distribution costs driven by higher diesel and petrol prices, alongside weak consumer purchasing power.

It warned that further taxation could erode profitability, force production cuts and trigger job losses, particularly among small and medium-scale operators, with ripple effects across agriculture, logistics and retail value chains.

While acknowledging growing concerns over non-communicable diseases such as diabetes, CPPE argued that taxing sugary drinks alone would not effectively address public health challenges.

It instead advocated for public education, healthier lifestyle promotion and collaboration with industry stakeholders.

The group also cautioned that introducing sector-specific taxes could create policy inconsistency, weaken investor confidence and undermine Nigeria’s business-friendly image.

CPPE urged the Federal Government and the National Assembly to halt any move toward implementing the tax, stressing that priority should be placed on supporting businesses, protecting jobs and sustaining economic growth.