MEDIA STATEMENT BY HIGGINS MDLULI, CHAIRMAN OF SA CANEGROWERS
February 4, 2025
The ongoing call by health activists for Finance Minister Enoch Godongwana to increase the sugar tax is misguided and, if actioned, will cause the further loss of rural livelihoods. South Africans simply cannot afford to keep supporting this misguided policy.
Health activists are calling for the minister to almost double the sugar tax in his 19 February budget speech and to expand it to fruit juices. When the sugar tax was initially instituted in 2018, the tax led to in excess of 16,000 job losses and R2 billion in lost revenue in the first year alone. Any extension or increase of the tax will unleash similar economic devastation upon South Africa’s sugar industry, leading to misery for the thousands who will lose their jobs as a result.
Health activists are also making the misleading claim that increasing the sugar tax will allow the government to fund more feeding schemes for children. These two government policies are unrelated, and the tax income from the sugar tax is not ringfenced for health outcomes.
In a video, the activist group Heala laments how hard it is for unemployed, rural families to feed their children. Yet they are advocating for a policy that will destroy rural jobs and put more families in this dire situation.
According to Heala, the sugar tax has led to only a “modest” decrease in consumption of sugary beverages. But Heala fails to mention the tax has not translated in any way to the tax’s stated objective – to address obesity and diabetes in South Africa. That is because these are multifactorial diseases, as per the World Health Organisation, and the causes range from food intake and a lack of exercise to underlying genetic conditions.
The government income collected from the sugar tax also comes at a cost. Because this tax destroys jobs and suppresses the income-levels of the sugar industry, this eventually negatively impacts the personal and corporate income tax paid in South Africa.
SA Canegrowers represents 24,000 small-scale and 1,200 large-scale growers in KwaZulu-Natal and Mpumalanga. These growers are vital employers and economic drivers in their rural communities, that offer fewer alternative employment options.
Pushing more rural South Africans into poverty by increasing a destructive tax will not be to the benefit of anybody.
SA Canegrowers once again calls on Minister Godongwana to scrap this destructive tax. We call on the Treasury and the Department of Trade, Industry and Competition to deliver the promised broad calorie intake study that measures everything people eat and drink to inform health policies with real evidence, and to deliver the study examining the socio-economic impact of the sugar tax.
ENDS
For media enquiries:
Gerhard Mulder
gerhard@resolvecommunications.co.za
083 305 9361