Evaluating Nigeria’s Sugar-Sweetened Beverage (SSB) Tax: A Critical Review of CAPPA’s Policy Proposals

 

 

1. Introduction

In May 2025, the Corporate Accountability and Public Participation Africa (CAPPA) published a follow-up to its 2024 report on sugar-sweetened beverages (SSBs) and processed food marketing. Titled “Junk on Our Plates: Exposing Deceptive Marketing of Unhealthy Foods Across Seven States in Nigeria,” the report calls for a steep increase in the SSB tax—from ₦10 to ₦130 per litre. CAPPA argues that marketing strategies employed by beverage companies significantly influence consumer habits and contribute to the rise in non-communicable diseases (NCDs).

While the report raises important concerns, its recommendations are based on weak data and flawed assumptions. This review provides a critical analysis of CAPPA’s policy proposals and their implications for Nigeria’s economy and public health.

 

2. Key Claims and Recommendations by CAPPA

CAPPA’s Main Assertions:

Policy Recommendations:

 

3. Analysis of the CAPPA Reports

3.1 Selective Use of Data

CAPPA’s first report cites Adetiloye et al., which highlights a high prevalence of obesity, particularly among urban women, due to sedentary lifestyles and dietary changes. However, CAPPA’s own findings show higher SSB consumption among young males aged 15–19, creating a mismatch between cause and effect in its justification for an SSB tax hike. CAPPA has not updated its data but has reached the same conclusions. Furthermore, CAPPA attributes rising obesity solely to SSBs, despite the Adetiloye et al. report pointing to multiple causes, including processed foods, income levels, and urbanization.

3.2 Inadequate Evidence of Impact

CAPPA fails to provide evidence that the existing ₦10/litre tax has reduced SSB consumption or improved health outcomes. Without a clear assessment of the current policy’s effectiveness, its recommendation for a 1200% tax hike lacks credibility.

3.3 Executive Secretary of the National Sugar Development Council) and journalist Abdullahi Yunusa, reported that Nigeria’s per capita sugar consumption stood at just 6.9kg in 2018—one of the lowest figures in West Africa.”

 

4. Economic Realities of the SSB Sector

4.1 Complex Industry Structure

The SSB industry in Nigeria is highly fragmented and dynamic, with diverse consumer segments and distribution channels. Tax enforcement in this environment is inherently challenging and risks disproportionately impacting small and medium enterprises (SMEs).

4.2 Heavy Tax Burden

In addition to the SSB tax, beverage companies already pay:

Combined, these taxes can exceed 40% of gross profit. According to PwC, the effective tax burden in the non-alcoholic beverage sector reaches 45%, making further excise increases unsustainable. The tax reform bills passed by the National Assembly is expected to streamline these taxes when it becomes law.

 

5. Fiscal and Policy Concerns

5.1 No Clear Revenue Data or Health Spending

Since the implementation of the SSB tax in 2022, the government has not released data on revenue generated or how those funds have been used to support health services. Without transparency and earmarked spending, the tax risks becoming a revenue-generation tool with little public health return.

5.2 Disproportionate Focus on SSBs

The World Bank notes that while SSBs are a significant source of added sugars, they are not the only contributor to poor diets and rising NCDs. A narrow policy focus on SSBs ignores broader issues such as processed food consumption, physical inactivity, and health literacy. Targeting sugar-sweetened beverages alone is arbitrary and discriminatory, as they do not have a unique impact on obesity or diabetes and do not make up a unique part of concern about overall diets.  Sugar-sweetened beverage taxes raise prices for families already facing cost of living crises and disproportionately affect low-income consumers, without any evidence they improve health.

 

6. CAPPA’s Simulation: Flawed and Risky

CAPPA’s simulation predicts a 29% drop in SSB consumption with a 39% increase in retail prices, targeting young people as the most price-sensitive group. WHO has twice reviewed and acknowledged (in 2017 and 2023) that sugar-sweetened beverage taxes are not “Best Buys,” which is their highest level of recommended health policy interventions, as there is not enough evidence to recommend them as cost-effective or impactful.  See Health Financing and Economics.  

However, such a dramatic price hike could lead to:

 

7. Policy Alternatives and Recommendations

7.1 Strengthen Enforcement, Not Just Tax Rates

7.2 Broaden Public Health Interventions

7.3 Evidence-Based Fiscal Policy

 

8. Conclusion

CAPPA’s latest report highlights legitimate health concerns but overextends its argument by proposing a steep and unjustified increase in the SSB tax. Without reliable data, a comprehensive strategy, or consideration of economic realities, the recommendation amounts to a “trigger-happy” fiscal policy. A more balanced, evidence-based approach is essential—one that addresses both public health and economic sustainability.

 

 

Bibliography

  1. Junk on our plates: Exposing Deceptive Marketing of Unhealthy Foods Across Seven States in Nigeria.  https://cappaafrica.org/wp-content/uploads/2025/05/Junk-on-our-plates-Offline-Monitoring-Report.pdf
  2. Taxes on Sugar – Sweetened Beverages: international Evidence and Experiences. Sept. 2020. https://openknowledge.worldbank.org/server/api/core/bitstreams/4ca4b739-f713-5a89-aca2-02ec50976e7c/content
  3. Health Financing and Economics. https://www.who.int/teams/health-systems-governance-and-financing/economic-analysis