Prove that sugar makes people fat, cane farmers ask Treasury
The beleaguered SA Canegrowers group, which represents sugar farmers, is again calling for the health promotion levy to be scrapped, this time highlighting that the Treasury missed a deadline to supply it with information on whether the tax reduced obesity.
The health promotion levy, or sugar tax, was proposed by Wits academics in 2016 who suggested that paying an added 20% of the price of a sugarsweetened beverage would help reduce obesity in SA.
The levy was introduced at 2018 and averages about 10% of the price of a sugary drink. It has led to beverage producers reformulating fizzy drinks to include lower sugar levels or more sweeteners.
The sugar farmers sent in a Promotion of Access to Information Act Application (Paia) to the Treasury asking it to provide all information and data relied upon when introducing the levy in 2018 as well as subsequent decisions to increase it.
The Treasury had 30 days to respond to the Paia request or request an extension for an additional 30 days. Other than an acknowledgement of the request, the canegrowers say they have not heard from back from the Treasury.
The Treasury was not immediately available for comment.
The cane growers, who are struggling to irrigate sugar due to intensive loadshedding and balancing cheap sugar imports, while SA’S largest sugar firm Tongaat Hulett future’s is uncertain, feel the sugar tax is an unnecessary straw on the camel’s back.
The farmers recently reported that load-shedding was expected to cost the industry more than R700m in 2023.
The cane farmers argument is that while sugar consumption has reduced, the tax was promoted as a means to reduce obesity and no data has been provided by the government to show that obesity levels have indeed lowered.
“With these headwinds facing the industry, and thousands of jobs on the line, maintaining the Health Promotion Levy is both unjustifiable and unconscionable,” it said.
The national budget expected to be introduced later this month.
The sugar tax is not ringfenced to deal with health or obesity but goes into general tax revenue streams.
In an Obesity Reviews journal article in 2021, academics — including those from Wits who proposed the tax — argued that purchases of sugary drinks and sugar intake dropped after the tax was introduced, and that this trend was more pronounced in lower socioeconomic groups, who consumed more sugary drinks.