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Prospects for Earmarking Revenue from Tobacco Taxes

Based on the results of CSEA’s Tobacco Tax Simulation Model (TETSiM), the government stands to gain about N67.7 billion additional revenue from the new tobacco taxation policy, within a one-year period. There are two alternative ways to channel the resources; either by earmarking[1] them for targeted projects, or adding them to the general revenue pool.
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Simulation of the Effect of Tax Increase

In June 2018, Nigeria introduced a new tax regime on tobacco products. In addition to the present 20% ad valorem excise duty charged on locally produced goods, tobacco products will now attract a specific duty of ₦20 per pack, which will rise to ₦40 and ₦58 in 2019 and 2020 respectively. Given government’s decision to adopt tobacco taxation as part of broader tobacco control measures, we examine the potential impacts of this new policy as well as other recommended changes in the tobacco tax levels.
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Snapshot of Taxes & Prices of Tobacco Products

Nigerian tobacco industry operates within an oligopolistic market structure, with BAT owning 79% of market brands, which allows for price differentiation across brands. However, price variations are also observed between the same brand both within and across regions, which suggests non-market factors could also contribute to the variability. For instance, the sale of cigarettes in sticks and the significant distance between production hubs and retail points, which generates asymmetric information, transportation cost and opportunity for arbitrage.

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Beyond Country-level Averages: Construction of Sub-National Human Development Index for the Nigerian States

This study develops a comparable Human Development Index for subnational government in Nigeria. While built on the UNDP approach, we extend the generic framework to address challenges at the subnational level such as comparable indicator, data unavailability, and estimation technique. The result shows a wide disparity across states in their human development, with states within the southern region recording more impressive performance. We further examine the key economic and political drivers of the observed variations across the state and found fiscal sustainability and geopolitical zoning as the key determinants.

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T20 Africa, G20 and Africa: Assessing Our Impact and Influence

As one of the key political and economic forums in the world, the G20 Summit was created to facilitate a stable and peaceful world through promoting several development agendas. Decisions taken by this forum help to support reform at the national and international levels. Since its creation in 2012, the T20 has comprised think tanks that aim at developing research and evidence-based briefs and recommendations to guide governments in policy development.  The T20 Africa Standing Group established in 2017 should monitor the extent to which its policy recommendations on  Africa-related issues have influenced and impacted policies and plans that emerge out of the G20.
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