South Africa

No sugar tax increase, farmers ask

South Africa’s sugarcane farmers and industry representatives petitioned lawmakers to halt increases in a levy on sugar-sweetened drinks for at least three years.

The health-promotion levy that came into effect in 2018 has had a “deleterious” impact on the industry, leading to losses of R8 billion in revenue, almost 10,000 jobs, and the shutdown of two sugar mills, Trix Trikam, an executive at the South African Sugar Association said in a statement.

Sugarcane farmers and industry representatives this week met lawmakers in the eastern KwaZulu-Natal province to discuss the issue.

“We do not seek direct bailouts,” he said. “We seek an opportunity to accomplish a just and fair transition in the sugar sector.”

Scrapping increases in the tax would allow industry stakeholders to pursue diversification opportunities through the government’s R14 billion plan to stem a crisis caused partly due to the levy, the sugar association said.

It’s also called on lawmakers not to lower the threshold for the sugar content attracting the levy for at least three years.

The National Treasury postponed a 4.5% increase in the tax on sugar-sweetened drinks by a year to April 2023.

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