The Food, Beverage and Tobacco Senior Staff Association (FOBTOB) have urged the Federal Government to re-evaluate the recommendation made by the Minister of Finance, Mrs. Kemi Adeosun to raise tariff on alcohol and tobacco because of their health implications and to raise revenue, hinting that it would lead to massive job loss in the country.
FOBTOB General Secretary, Mr Iji Solomon, who made the call when he spoke to reporters, said that the recommendation to raise tariff on the products could affect their manufacturers and lead to redundancy.
“There is no doubt that the minister proposed the increase based on ECOWAS Common External Tariff, but it should not be at the detriment of local manufacturers or the economy”.
The union’s scribe said the price disparity for each of the products by the minister was not understandable but that any increase would impact on the workforce.
“Ad valorem” tariff (Value Tax) was a normal tariff on products in the industry but it could increase the unit tax of tobacco.
According to Solomon, about 2,000 workers have lost their jobs in the last two years because of the closure of companies and economic indices.
He said the only tobacco company in Nigeria needed incentives while distilleries should be encouraged to employ more workers rather than sack them.
“Many distilleries closed business because they can no longer access foreign raw materials for production. Only a few are working and any increase will lead to redundancy.
“Since the distiller companies use local materials, increase in tariff can lead to their collapse. Secondly, with an increased tariff, the distillers will be unable to compete with imported ones,” he said.
Solomon urged the government to collaborate with industry stakeholders such as Food, Beverage and Tobacco Employees and Manufacturers Association of Nigeria (MAN) on the issue.