STUDY ON EFFECTS OF INCREASED TOBACCO TAX ON TOBACCO CONSUMPTION AND AFFORDABILITY IN NIGERIA
The World Health Organisation – Framework Convention on Tobacco Control (WHO-FCTC) notes that effective tobacco taxes are important to reduce tobacco consumption and prevalence. In line with the FCTC, Nigeria’s National Tobacco Control Act (NTC Act) 2015 in Section 43 urges the governments of the Federation and their Ministries, Departments and Agencies to implement tax policies, strategies, programmes or other fiscal measures which promotes the objectives of the Act and in accordance with the Framework Convention on Tobacco Control, its implementing guidelines and protocols.
Nigeria in June 2018 increased taxes on tobacco (cigarettes). Prior to this time, taxes were only on Ad Volarem of 20% without specific taxation on tobacco (cigarettes). Effective 4th June 2018, in addition to the 20% Ad Volarem, specific taxes for cigarettes are made as follows:
- ₦20 for a pack of 20 sticks in 2018
- ₦40 for a pack of 20 sticks in 2019
- ₦58 for a pack of 20 sticks in 2010.
The increases may not amount to much if the health consequences are not affected positively. It is in this line that it becomes important to interrogate how far these increases have had effect on affordability and consumption of tobacco products.
- PURPOSE OF THE CONSULTANCY
This Consultancy seeks to review the legal and policy context of tobacco taxation as well as the broader environment of the tobacco sector. More specifically, this consultancy seeks to conduct a study on effects of increased tobacco taxation on tobacco consumption in Nigeria.
It is widely recognized that an effective tax system cannot only contribute to revenue generation but also regulate economic activities and decisions. Within the tax justice campaign, reference is made to the 4 R`s of taxation including: 1) Revenue generation, 2) Redistribution, 3) Representation 4) Repricing.
In the context of tobacco tax advocacy, a well-designed tax system can be used to reprice the cost as a measure to control and discourage tobacco consumption. 181 countries are parties to the World Health Organization (WHO) Framework Convention on Tobacco Control which recognizes the centrality of raising tobacco taxes as a critical measure to mitigate the damaging impacts of tobacco consumption. CISLAC is working with other partners in Africa within the the Tax Justice Network Africa to push the bar on tobacco control through advocating the use of price and tax measures to reduce tobacco prevalence. Thus CISLAC is engaging in this study to interrogate the current tobacco tax regime on tobacco consumption.
The result of the study will inform the advocacy process for the project. It is anticipated that the study will generate accurate and reliable data that will not only be a critical part of the advocacy process but also provide broad information for tobacco and related sectors in the production, distribution, consumption chain.
- SCOPE OF WORK
The consultants shall:
Overall the study will also provide recommendation for tobacco consumption control within the context of the existing taxation regime as well as propose possible measure for taxation advocacy.
The overall objective of the consultancy shall be to review selected relevant existing documents on tobacco taxation and consumption in Nigeria with a comparative regional and global perspective. This will subsequently be supported with primary data as will be necessary to further build evidence for the project advocacy objective. The consultancy shall be guided by the following specific tasks.
The specific tasks include:
- Review existing data and documents on tobacco taxation and consumption in Nigeria.
- Review the last two financial years tobacco related tax measures and consumption effects thereof
- Review the ongoing tobacco tax regime and show link between the increase on affordability
- Review measures aimed at controlling tobacco consumption in Nigeria.
- Review Nigeria Tobacco taxation regime against international best practices
- In close consultation with CISLAC, identify the key stakeholders in the sector for purposes of the study as well as the subsequent advocacy process.
- Undertake primary data collection to generate further and new supporting information on the area of the study. This process should include the views of all the stakeholders in the tobacco production, distribution and consumption chain.
- Develop a clear and analytical report with relevant recommendations for both tobacco taxation and consumption control advocacy interventions.
4. Present the findings of the study to stakeholders.
- Inception Report
- Data collection and reporting schedule
- Draft Report
- PowerPoint presentation
- Final Report
The consultancy fees shall be as agreed with the consultant based on best value for money. The consultancy fees shall be inclusive of statutory withholding tax deductions.
The Consultant shall be paid on 30%, on submission of inception report, 30% on submission of Draft Report and 40% upon satisfactory completion of the tasks and submission of final report.
The consultant shall report to the Programme Manager – (Democratic Governance) Civil Society Legislative Advocacy Centre (CISLAC).
This agreement shall become effective upon signature by both parties and run for a period not exceeding one calendar month.
Qualifications and Competencies
A Master’s Degree in Economics; Social Sciences or any other relevant field.
- At least 5 to 7 years’ experience in taxation research and or advocacy with national exposure. Continental and global exposure will be an added advantage
- Demonstrated in-depth knowledge and interpretation of Nigeria’s taxation policies
- Expertise in application of taxation and tax policies to programming and advocacy
- Demonstrate in-depth knowledge of the context of taxation measure in both revenue generation and control of consumption
- Involvement in tobacco control efforts will be an added advantage
- Language proficiency and report writing skills is mandatory
With the subject “TERMS OF REFERENCE FOR CONSULTANT: STUDY ON EFFECTS OF INCREASED TOBACCO TAX ON TOBACCO CONSUMPTION AND AFFORDABILITY IN NIGERIA”, interested consultants should provide the following to firstname.lastname@example.org copying email@example.com on or before Close of Business 27th January 2019:
- The consultant’s understanding of the TOR and how he/she (they) intend to carry out this assignment.
- A profile of the consultant highlighting the relevant experience in doing similar work OR the Curriculum Vitae (CV) of the consultant highlighting how he/she meet the requirements.
- Samples of previous work done that are similar to the consultancy
- Indication of availability to start and undertake this assignment