PRESS STATEMENT BY HIGGINS MDLULI, CHAIRMAN OF SA CANEGROWERS
March 10, 2025
Finance Minister Enoch Godongwana’s undelivered budget in February wisely did not raise the sugar tax, allowing the sugar industry the space to prioritise plans for diversification. SA Canegrowers hopes Minister Godongwana will continue to support policies that enable long-term economic growth over the job-killing sugar tax, ensuring that the sugar industry can invest in innovation, job creation, and sustainable development.
Since the introduction of the Health Promotion Levy, commonly known as the sugar tax, in 2018, South Africa has seen no measurable benefit. Instead of driving meaningful health improvements, the tax has placed immense pressure on the country’s sugar industry, threatening jobs, and economic stability, particularly in rural communities.
The sugar industry is a key driver of economic growth, supporting nearly one million livelihoods across farming, milling, and related industries. Small-scale growers, who form the backbone of the industry in KwaZulu-Natal and Mpumalanga, rely on sugarcane farming to sustain their families and are often anchors in their communities. Yet, when the sugar tax was first introduced, it destroyed over 16,000 jobs in its first year alone, as confirmed by an independent study conducted by Nedlac. Any expansion of the tax will only further damage a sector that has long been a pillar of economic resilience and rural development.
SA Canegrowers represents 24,000 small-scale and 1,200 large-scale growers in KwaZulu-Natal and Mpumalanga.
Rather than burdening these South African farmers with the effect of the sugar tax, the focus should be on unlocking growth opportunities within the agricultural and agro-processing sectors. Through the Sugar Industry Value Chain Master Plan 2030, many opportunities for economic growth and job creation have been identified. Through a supportive policy environment that encourages private investment, the sugar industry can create further jobs and drive long-term economic prosperity. Supporting the diversification of sugarcane into products such as biofuels and sustainable aviation fuels (SAFs) could further expand economic opportunities and position South Africa as a regional hub for decarbonisation.
The South African sugar industry is at a crossroads. Policymakers must decide whether to continue down a path of increasing taxation that stifles growth and job creation or shift toward an economic strategy that empowers small businesses, supports rural development, and secures a sustainable future for the industry and the country.
SA Canegrowers remains committed to advocating for policies that promote economic stability and opportunity. We stand in support of a future where long-term growth, innovation, and job creation take priority over short-sighted taxation measures that harm livelihoods.
ENDS
For media enquiries:
Gerhard Mulder
gerhard@resolvecommunications.co.za
083 305 9361
