The National Union of Food, Beverage and Tobacco Employees has called on the House of Representatives to reject a proposed amendment to Nigeria’s soft drinks tax, warning that the move could trigger factory closures, job losses and worsen the challenges facing the manufacturing sector.

The union made the appeal in an open letter to the Speaker of the House of Representatives, Tajudeen Abbas, co-signed by its President, Garba Dankama.

The proposed legislation, known as the Customs, Excise Tariff, etc. (Consolidation) Act (Amendment) Bill, 2025, passed its third reading in the Senate on June 4, 2026, and is awaiting concurrence by the House of Representatives.

Dankama expressed concern over worsening operating conditions in Nigeria’s manufacturing sector, citing high borrowing costs, rising energy and logistics expenses, foreign exchange constraints and declining consumer purchasing power. He said the challenges had forced several manufacturers to reduce production or shut down operations.

He warned that imposing an additional tax on the non-alcoholic drinks sector could further strain manufacturers, given the industry’s extensive links with agriculture, transportation, distribution and retail.

“The NAD sector, which anchors hundreds of thousands of jobs across farming, haulage, distribution, and retail, cannot absorb an additional tax escalation without triggering a wave of further closures, retrenchments, and value chain collapse,” he stated.

Dankama also questioned the proposed tax’s potential public health benefits, arguing that soft drinks account for a relatively small share of Nigerians’ total sugar consumption.

He argued that higher taxes on the products could push consumers towards cheaper, unregulated alternatives while threatening jobs across the industry’s value chain.

“Taxing a product category that contributes only 5% of national sugar intake will not yield real public health benefits. It will simply push consumers toward cheaper, unregulated alternatives, while destroying the livelihoods of over a million Nigerians who have already borne the brunt of recent economic reforms,” he noted.

Dankama also said workers’ earnings had failed to keep pace with rising transportation, food and housing costs following the Federal Government’s removal of the fuel subsidy and foreign exchange reforms.

The Customs, Excise Tariff, etc. (Consolidation) Act (Amendment) Bill, 2025, seeks to replace the existing fixed excise duty of N10 per litre on sugar-sweetened beverages with a levy based on a percentage of their retail prices.