Excise Duty Hike: A New Burden

Excise duties are indirect taxes on the sale or use of specific products, such as alcohol,  tobacco, and energy. In Nigeria, Excise duty is applicable on beer and stout, wines, spirits, and cigarettes. 

According to the 2022 Fiscal Policy Measures issued by the Federal Government in March  2022, the new regime applies to tobacco and its products (such as cigarettes), alcoholic beverages (beers and stouts, spirits, and wines), and non-alcoholic beverages and telecommunication services.  

While the implementation of the increased excise duty for alcoholic and tobacco products commenced on 1st June 2022, the Federal Government has widely publicised its intent to significantly increase excise tax for both the alcoholic and tobacco sectors.

The proposed move, if implemented, would amount to a departure from the recently established roadmap set out in the 2022 Fiscal Policy Measures and Tariffs Amendments  (FPM 2022) which covers 2022-2024.