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Tuesday, October 22, 2019

Over 250,000 People Will Loss Their Job If You Implement Tax On Soft-drinks - NECA Warns FG

The Nigeria Employers Consultative Association (NECA), Lagos Chamber of Commerce and Industry, has warned the Federal Government to cancel it planned imposition of tax on soft drinks.
NECA cried out that more Nigerians may lose their jobs and sellers of carbonated drinks will likely close shop as a result of poor sale should the Federal Government impose tax on soft drinks.

Its Director-General, Timothy Olawale, specifically said the jobs of about 250,000 people working directly and indirectly in the industry would come under threat.

He said: “In our considered opinion, reintroduction of excise tax on non-alcoholic beverages should not be the case. 

With the myriad of taxes and levies already being paid by businesses, the reintroduction of excise in a sector with high price elasticity means that government is desirous of killing businesses in the sector completely.

“Once prices are increased, consumers will push back, resulting in sharp decline in demand. With the planned increase in VAT, the introduction of excise will further burden operators in the sector with the following consequences: low demand leading to unsold products; 

incomes squeeze on businesses that are already struggling with low margin and massive staff layoff, which will affect over 250,000 direct and indirect employees in the sector among others.”

NECA gave this warning in reaction to the FG’s plan as revealed by the Minister of Finance, Budget and National Planning, Zainab Ahmed.

MackenzieSkyBlog gathered that the minister disclosed this in a statement during the 2019 annual meetings of the International Monetary Fund/ World Bank, in Washington DC, United State. Adding that the tax as well as additional Value Added Tax on imported goods was meant to increase the government’s revenue generation.

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