A recent peer-reviewed study reveals the potential of a sugar-sweetened beverage (SSB) tax to significantly enhance healthcare financing in Nigeria. The study utilized a mixed-methods political economy analysis, including a robust modeling exercise to predict the revenue impact of the SSB tax over the next five years.
The projections are striking: the SSB tax policy could generate USD 35.9 million in its first year and amass a total of nearly $190 million USD over five years. Although this revenue represents approximately 1% of the estimated $20 billion USD needed for Nigeria’s 5-year surgical plan, it offers a substantial contribution to the healthcare budget. Furthermore, the study suggests that by increasing the SSB tax rate, annual revenues could potentially rise to $107.7 million USD.
Key findings from the study emphasize the necessity of earmarking these tax revenues specifically for surgery and primary healthcare initiatives. Addressing non-communicable diseases through improved primary healthcare infrastructure is crucial, and the allocation of SSB tax revenues could be a strategic step in this direction.
The study advocates for evidence-based advocacy to not only promote higher SSB tax rates but also to encourage the implementation of other ‘sin taxes’ to generate dedicated funds for the healthcare system. These efforts are seen as critical to strengthening healthcare financing and improving the availability and quality of surgical care across Nigeria.