ABUJA, March 11 (Xinhua) -- The Nigerian government on Sunday confirmed a hike in excise duty rates for alcoholic beverages and tobacco.
Minister of finance Kemi Adeosun said the amendment of the excise duty rates, approved by President Muhammadu Buhari, will take effect from June 4.
"The president also granted a grace period of 90 days to manufacturers of the products before the commencement of the new duty regime," Adeosun said in a statement.
To moderate the impact on prices of the products, she said, the new excise duty rates would spread over a three-year period, from 2018 to 2020, as the government seeks to raise fiscal revenues.
According to the minister, the new duty rate on tobacco will be a combination of the existing ad-valorem base rate and specific rate while the ad-valorem rate will be replaced with a specific rate for alcoholic beverages.
This, she said, will prevent revenue leakages and curb the discretion in the unit cost analysis for determining the ad-valorem rate.
Nigeria's cumulative specific excise duty rate for tobacco is 23.2 percent of the price of the most sold brand.
The newly approved specific excise duty rate for alcoholic beverages cut across beer and stout, wines and spirits, Adeosun said.
The new excise duty regimes are in line with the Economic Community of West African States (ECOWAS) directive on the harmonization of member-states' legislation on excise duties, she added.