The Food, Beverage and Tobacco Senior Staff Association (FOBTOB) has urged the Federal Government to re-evaluate the recommendation to raise tariff on alcohol and tobacco to prevent job losses.
The General Secretary of FOBTOB, Mr Iji Solomon, made the call when he said on Thursday in Lagos.
The Minister of Finance, Mrs Kemi Adeosun, had recommended an increased tariff on alcohol and tobacco because of their health implications and also to raise revenue.
According to Solomon, the recommendation to raise tariff on the products could affect manufacturers of these products and would lead to redundancy.
“There is no doubt that the minister proposed the increase based on ECOWAS Common External Tariff, but it should not be to the detriment of local manufacturers or the economy,’’ he said.
The union’s scribe said that the disparity in price for each of the products by the minister was not understandable but that any increase would impact on the workforce.
He said that the “Ad valorem’’ tariff (Value Tax) was a normal tariff on products in the industry but it could increase the unit tax of tobacco.
Solomon also said that about 2,000 workers have lost their jobs in the last two years because of the closure of companies and economic indices.
He said that 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 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 not be able to compete with the imported ones,’’ he said.
Solomon urged the government to collaborate with industry stakeholders such as Association of Food, Beverage and Tobacco Employees and Manufacturers Association of Nigeria (MAN) on the issue.