Photo by PIUS UTOMI EKPEI / AFP
‘Govt Should Suspend Taxes On Imported Petroleum Products’
Nigeria’s inflation rate recorded a seventh consecutive monthly rise to 18.6 percent in June, representing a 0.9 percent point rise from the 17.71 percent it was in May 2022.
This is the highest since January 2017.
The National Bureau of Statistics (NBS) said this in its consumer price index (CPI) report for June 2022, released on Friday.
In his sharp reaction to the persistent rise in inflation rate in the country, the founder/Chief Executive Officer (CEO), Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf said as one of the major drivers of inflation is high energy costs, saying that the government should as a matter of urgency suspend all forms of taxes and levies on the importation of petroleum products to give a respite on the spiking energy cost.
The figure released by the NBS for June this year is also 0.84 percent points higher compared to June 2021, which is 17.75 percent.
According to the report, increases were recorded in all classifications of individual consumption according to purpose (COICOP) divisions that yielded the headline index.
“On a month-on-month basis, the headline inflation rate increased to 1.82 percent in June 2022, this is 0.03 percent higher than the rate recorded in May 2022 (1.78 percent),” the report reads.
“The percentage change in the average composite CPI for the 12 months ending June 2022 over the average of the CPI for the previous 12 months period is 16.54 percent, showing a 0.62 percent increase compared to 15.93 percent recorded in June 2021.”
The report added that food inflation rose to 20.60 percent in June 2022 on a year-on-year basis but the rate of changes in average price level declined by 1.23 percent when compared to 21.83 percent in June 2021.
The report further explained that the rate of changes in food prices compared to the same period last year was higher due to higher food prices volatility caused by COVID-19.
“This rise in the food index was caused by increases in prices of bread and cereals, food products n.e.c, Potatoes, yam, and other tubers, meat, fish, oil and fat, and wine,” it added.
“On a month-on-month basis, the food sub-index increased to 2.05 percent in June 2022, up by 0.03 percent from 2.01 percent recorded in May 2022.”
In analysing price movements for states, the report said Bauchi and Kogi states were the highest.
“In June 2022, all items inflation on a year-on-year basis was highest in Bauchi (21.99 percent), Kogi (21.37 percent), Ebonyi (20.73 percent) while Adamawa (16.14 percent), Sokoto (16.31 percent) and Jigawa (16.37 percent) recorded the slowest rise in headline year-on-year inflation,” it said.
Yusuf said for the basket of goods consumed by most households, prices have jumped by between 30-100 percent over the past one year.
“The same is true of businesses. The spiraling inflation dynamics demands an urgent policy response at the highest level of government,” he said, adding that the impact on citizens’ welfare is inestimable.
“Pressure of spiking inflation on household budgets has been excruciating and unbearable.”
He said, “Purchasing power has been massively eroded, real incomes have been depressed, and the poverty incidence has consequently worsened. The effect on SMEs is troubling.”