Yar’Adua Approves Duty Removal on Beverages, Noodles

President Umaru Musa Yar’Adua has approved the removal of the five per cent excise duty on non-alcoholic beverages, juices, and instant noodles.
This, according to a Presidency source, is geared towards lessening the burden on local manufacturers in the country and assuaging the suffering of ordinary Nigerians in the face of the worsening global economic crisis that has led governments of the developed countries to pump several billions of dollars into their economy to safe their financial system from collapse.
The source said President Yar’Adua actually agreed in principle with the excise duty removal proposal a week ago but finally approved it last Friday night.
The source further said a circular to this effect would be out this week. Since the world is a global village, Nigeria like the rest of the world has also been feeling the effect of the global financial meltdown that has led to the fall in the price of oil at the international market. This has not triggered a reduction in government revenue but also necessitated the weakening of the naira that has depreciated from N118 to one United States dollar in November 27 last year to N150 per dollar today.
The removal of the excise duty by the Federal Government would go a long way in helping local manufacturers since some of the inputs into their products have some foreign content.
Minister of State for Finance, Mr. Remi Babalola, had dropped the hint about the excise duty removal about three weeks ago while meeting with chairmen and managing directors of over 25 manufacturing companies under the aegis of Association of Food, Beverages and Tobacco Employers (AFBTE) in Abuja.
He however, pointed out that the importation ban on biscuits, flour and confectionery would remain.
"We have to find a way by which we have to remove the five per cent excise duty. The excise duty is going to be revisited and reconsidered. We are going to make recommendation to Mr. President on the need to remove the five per cent excise duty," Babalola had said.
"No department is established to earn revenue for the government. It is to facilitate trade, and it is only through facilitating trade that revenue will come,” the minister noted.
The Federal Government had last October introduced the five per cent excise duty on non-alcoholic beverages, juices and instant noodles and lifted the importation ban on biscuits, flour and confectionery.
Earlier at the meeting with Babalola, AFBTE had through its President, Chief Emmanuel Ukpabi, urged the Federal Government to urgently intervene on the excise duty and the lifting of importation ban.
He said the imposition of such duty would worsen the effect of the current global crisis on the local producers.
Responding, Babalola had told members of the association present that the Federal Govern-ment's policy direction was designed to boost investment and reduce the impact of the global crisis on the local industrialists.