NECA Calls For Reversal Of 2023 Fiscal Policy Measures

The Nigeria Employers Consultative Association (NECA) has urged the federal government to suspend the proposed tariff increases for the manufacturing sector.

In a statement issued in Lagos, NECA’s Director-General, Adewale-Smatt Oyerinde, also called for the reversal of the 2023 Fiscal Policy Measures (FPM), already approved by President Muhammadu Buhari on May 12.

NECA noted that the 2023 FPM which seeks to increase taxes on excise duty on alcoholic beverages, cigarettes and tobacco products; the introduction of excise duty on single-use plastics; and Import Adjustment Tax levy on vehicles of 2000, will be disastrous for the manufacturing sector that is not yet ready for such increases.

The 2023 FPM includes Supplementary Protection Measures for the implementation of the ECOWAS Common External Tariff (2022 – 2026).

NECA advised the government to instead revert to the 2022 FPM roadmap designed to lapse in 2024.

With more than 60 different taxes and levies currently being paid by businesses, the best that government can do is not to overburden the sector or cause relocation of many more to other climes.

The statement reads: “While government’s new FPM will largely affect manufacturers, it also has the potential to disrupt organised private sector’s value-chain with consequential effects on Nigerians as a whole.

“While we understand government’s revenue challenges, the proposed increases will spike production costs and reduce the competitiveness of Nigerian manufacturers in local and international markets.

“With recent reports of unemployment rate hovering above 40 per cent, the economy will be further hard-pressed to withstand the likely loss of jobs that will follow these increases.

“With more than 60 different taxes and levies currently being paid by businesses, the best that government can do is not to overburden the sector or cause relocation of many more to other climes.

“With about 20 bills pending at the National Assembly with financial implications for businesses, the government will do well not to overburden the organised private sector.

“The 2023 FMP as proposed will neither promote economic growth nor achieve the long-term revenue projection of government,” NECA warned.