Nigeria's new alcohol tax will grow the illicit market it claims to fight

Lagos, Nigeria: June 29, 2026 As Nigeria's new excise duties on beer, stout and spirits take effect on July 1, 2026, the Foundation for Consumer Freedom Advancement (FCFA) is urging the Federal Government to pause the three-year escalation schedule and rethink an approach that will hand the illicit market its biggest gift in years.

Under the 2026 Fiscal Policy Measures, beer and stout now attract ₦72 per litre, rising to ₦80 by 2028, while spirits face a 30% ad valorem rate plus ₦75 per litre. The people who will feel this first are not the wealthy buyers of imported whisky. They are the trader in Aba and the factory worker in Lagos who buy a bottle of stout after a long shift, and who watch every naira.

Mr. Olumayowa Okediran, Chairman of the Foundation for Consumer Freedom Advancement, commented:

"Government says this tax protects Nigerians. It does the opposite. Around two of every five bottles of spirits sold in this country are already illicit, and the Euromonitor data puts the lost trade at over ₦428 billion a year. When you raise the price of the legal, regulated bottle, you do not stop people drinking. You send them to the bottle nobody inspected."

"The low-income Nigerian does not quit when the price goes up. He switches to homebrew with no quality control, no label, and sometimes methanol in it. A tax that moves people from a regulated drink to a dangerous one is not public health. It is public harm."

"Nigerian adults can decide for themselves what to drink. Stacking another tax on households already squeezed by fuel, data and electricity costs, partly to satisfy a World Bank loan condition, is not consumer protection. It is consumer paternalism."

— Mr. Olumayowa Okediran, Chairman, Foundation for Consumer Freedom Advancement

The same framework is opposed by Nigeria's Beer Sectoral Group, with PwC analysis estimating up to ₦425 billion in losses for a sector that supports an estimated 1.5 million jobs and roughly a third of national manufacturing output. FCFA notes the contradiction: the compliant brewer and the licensed retailer pay more, while the illicit operator pays nothing and gains market share.

FCFA is calling on the Minister of Finance, Mr. Wale Edun, to suspend the 2027 and 2028 increases, publish evidence that the existing rates reduced harm, and redirect enforcement toward the illicit trade rather than the Nigerians who buy legal, taxed products.