In a press statement released today, Minister of Finance Kemi Adeosun has announced an increase in the excise duty rates for alcoholic beverages and tobacco with effect from June 4, 2018. Manufacturers have thus being given a three-month grace period. The increase in taxes will be phased from now till 2020. An excise duty tax is a tax charged on goods produced within a country.
Reasons behind the increase
Adeosun hinged the increase on the need to increase government revenue and combat the risks associated with alcohol and cigarette abuse.
The new excise duty regimes, according to her are in line with the Economic Community of West African States (ECOWAS) directive on the harmonisation of member-states’ legislation on excise duties, as well as recommendations by the International Monetary Fund (IMF) and World Bank.
The new taxes
A stick cigarette will attract a ₦1 specific rate per stick (₦20 per pack of 20 sticks) in 2018, a ₦2 specific rate per stick (₦40 per pack of 20 sticks) in 2019 and ₦2.90k specific rate per stick (₦58 per pack of 20 sticks) in 2020.The current ad valorem tax of 20% on cigarettes will, however, remain in place.
Beer & Stout would attract ₦0.30 per centilitre (Cl) in 2018 and ₦0.35 per Cl each in 2019 and 2020.
Wines would attract ₦1.25 per Cl in 2018 and ₦1.50 per Cl each in 2019 and 2020, while ₦1.50 per Cl was approved for Spirits in 2018, ₦1.75 per Cl in 2019 and ₦2.00 per Cl in 2020.The ad valorem tax on alcoholic beverages has however been removed.
What the data says
Data from the National Bureau of Statistics reveal Nigeria’s beverage and tobacco imports were N64.9 billion in 2017 up from N49 billion in 2016. Nigeria’s tobacco export was N8.9 billion in the 4th quarter of 2017 alone. However, within Africa, Nigeria’s mainly exports tobacco to Ivory Coast, Benin Republic and Burkina Faso. Total African exports were about N2.3 billion.
Why it matters?
Nigeria is considered a manufacturing hub for tobacco and alcoholic products in Africa. Most of the newly setup tobacco plants are strategically located in Nigeria to help facilitate exports to smaller neighbouring African countries. Critics suggest this new tax could affect future investments in the tobacco sector. Nairametrics intel suggests about 21 billion sticks of cigarettes are produced annually in Nigeria.
Nigeria’s Ngozi Okonjo-Iweala close to being announced as new DG of WTO
Ngozi Okonjo-Iweala is expected to be announced as the new DG of the World Trade Organisation.
Nigeria’s former Finance Minister, Dr Ngozi Okonji-Iweala, is close to being appointed as the new Director-General of the World Trade Organisation (WTO).
According to Reuters, a group of ambassadors also known as “troika” has proposed Ngozi Okonjo-Iweala to lead the WTO giving her a clear path to becoming the first woman to head the WTO since it started 25 years ago. The three ambassadors are thought to wield significant powers in determining what is a very “intricate and opaque” process.
Most Nigerian Media houses have already announced NOI as the winner of the process even though this is yet to be made official by the WTO.
The winner for the role of DG of WTO is expected to be announced formally by the WTO later today.
However, there appears to be a new twist, in the expected announcement of her emergence as the new Director-General of the WTO.
The United States through its representative at the WTO has insisted that the South Korean candidate is still in contention and that Washington will not recognize Okonjo-Iweala as the consensus candidate for appointment as Director-General.
As a result, the General Counsel of WTO, postponed the announcement of a new Director-General until November 9, after the US presidential election, after further consultations would have been made.
The announcement of Okonjo-Iweala, who is reported to have gotten the support of a vast majority of members states, including the EU, Japan and China, as the new boss of the World Trade Organization, would have been a huge boost for Africa
Kano State presents N147.9 billion budget for 2021 fiscal year
Governor Ganduje has presented the total sum of N147.9 billion as Kano State’s proposed budget for 2021 fiscal year.
Kano State Governor, Abdullahi Ganduje has presented the total sum of N147.9 billion as its proposed budget for 2021 fiscal year before the Kano State House of Assembly today.
Presenting the budget tagged “Budget for Economic Recovery and Sustainable Development,”Governor Ganduje said the budget is in furtherance of his administration’s vision for diversification of the state sources of revenue which will engineer development in the future.
Backstory: Recall that Nairametrics had earlier reported the drive and optimism by Kano State government to boost its Internally Generated Revenue. This might probably explain why IGR increased by almost 10% between 2020 allocations and proposed estimates for 2021.
What you should know: The breakdown of the budget verified by Nairametrics showed the following key highlights:
- The total budget increased by approximately 7.0% from N138.279 billion in 2020 to N147.935 billion in 2021.
- Capital expenditure for the periods under view increased by 10.93% from N60.485 billion to N67.095 billion.
- Recurrent expenditure also increased from N77.79 billion to N80.839 billion, indicating a 3.92%. increase for the periods under view.
- Internally Generated Revenue (IGR) increased by approximately 10% from N24 billion to N26.395 billion during the period under view.
- A breakdown of the budget showed that the Education sector has over N37 Billion representing 25% of the total budget while the health care delivery service has over N25 Billion representing 17% of the total budget.
Why Okonjo-Iweala should win the WTO DG role – Prof. Moghalu
Professor Kingsley Moghalu has thrown support behind Dr. Ngozi Okonjo-Iweala to win the World Trade Organization top job.
A former Deputy Governor of the Central Bank of Nigeria, Professor Kingsley Moghalu, has publicly canvassed support for Dr. Ngozi Okonjo Iweala to win the World Trade Organization (WTO) top job.
The former professor of public policy at Fletcher School, Tufts University, made the disclosure via his official Twitter handle, as seen by Nairametrics
Prof. Moghalu made a strong case for why Africa’s candidate should be considered for the top shot, noting that the need for Africa to get a better deal in the world trading system should be a major criterion in selecting the next WTO DG. He also believed that correcting this negatively skewed trade deal will help tackle poverty and underdevelopment in Africa.
The dynamics of world trade are rigged against Africa, keeping the continent poor and undeveloped. In this piece for Project Syndicate @ProSyn I make a strong case for why Africa’s candidate, @NOIweala, should be selected as the next Director-general of @wto https://t.co/G4Fyxd1z91
— Kingsley Moghalu (@MoghaluKingsley) October 26, 2020
What you should know
Nairametrics had earlier reported that Nigeria’s Ngozi Okonjo-Iweala and South Korea’s Yoo Myung-hee have emerged as the last two candidates for the top WTO job.
Prof. Moghalu also disclosed that the final selection decision is expected this week or very early next week.
Prof. Moghalu said, “The dynamics of world trade are rigged against Africa, keeping the continent poor and undeveloped. In this piece for Project Syndicate @ProSyn, I make a strong case for why Africa’s candidate, @NOIweala, should be selected as the next Director-General of @wto.
“The final selection decision is expected this week or very early next. Alongside the case for why the African candidate Okonjo-Iweala is best placed to lead WTO, I make the case for the continent more broadly as to how and why it must get a better deal in the world trading system.”
What this means
If finally selected for the top job, the opportunity will present Dr. Okonjo the platform to solve some global trade-related issues, one of which is Africa’s trade position with the rest of the world.