Court blocks Nigeria Customs from taxing beverage firms
In a significant legal victory for members of the Nigeria Employers’ Consultative Association (NECA), Justice Obiora Egwuatu of the Federal High Court in Abuja ruled on January 30 that the Nigeria Customs Service (NCS) must immediately stop collecting excise duties on non-alcoholic, carbonated sweetened beverages.
This ruling impacts major companies like Nigeria Bottling Company Limited (NBC) and Seven-Up Bottling Company Limited (SBC), which are part of NECA.
The case, which began on October 28, 2022, saw Justice Egwuatu declare that the NCS had no legal grounds to enforce the excise duty collection. The ruling also found the Finance Act of 2021, which introduced a ₦10 per liter tax on certain beverages, to be invalid due to non-compliance with legal procedures.
The court also declared the 2022 Fiscal Policy Measures, which sought to amend tariffs and implement the excise duty, as null and void. Additionally, the NCS was ordered to stop demanding transport and feeding allowances from the plaintiffs.
After three years of legal proceedings, Justice Egwuatu emphasized that the failure to follow proper legal procedures rendered the tax collection process invalid. The court awarded the plaintiffs a cost of ₦200,000.
This ruling represents a major win for the Organized Private Sector in Nigeria, challenging what they view as unfair and unlawful fiscal policies.
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