Sugarcane growers are calling for the health promotion levy to be scrapped.
The health promotion levy, or sugar tax, was proposed in 2016 by Wits academics who suggested that paying an added 20% of the price of a sugar-sweetened beverage would help reduce obesity.
The levy was introduced in 2018 and averages about 10% of the price of a sugary drink.
In December 2023 SA Canegrowers sent in a Promotion of Access to Information Act application to the Treasury to provide all information and data relied on when introducing the levy in 2018, as well as for subsequent decisions to increase it.
Other than an acknowledgment of the request, SA Canegrowers say they have not heard back from the Treasury.
They argue that although sugar consumption has gone down, no data has been provided by the government to show that obesity levels have fallen in tandem.
The farmers recently reported that load-shedding was expected to cost the industry more than R700m in 2023.
‘In the absence of any proof that the levy has been effective, and in light of the demonstrated economic destruction of the levy, SA Canegrowers calls on Godongwana to not only reverse the decision to increase the levy but to scrap the levy entirely.’
The sugar tax is not ring-fenced for health issues but goes into the general tax revenue streams. Researcher and economist Neva Makgetla said: ‘Society bears the brunt of the overconsumption of sugar and the costs of diabetes and [sicker] people through higher health costs and higher medical insurance rates.’