Cane growers worried about job losses
SA Canegrowers has welcomed the 12-month delay in the planned increase in the Health Promotion Levy (HPL or sugar tax) from 2.21 to 2.31 cents per gram of sugar.
It said the sugar tax had cost South Africa more than 16 000 jobs and R2.05 billion.
SA Canegrowers chief executive Thomas Funke says the increase had been tabled despite the government failing to produce any evidence to date that the tax has had any impact on bringing down obesity levels in the country since it was introduced in 2018.
“Modelling commissioned by SA Canegrowers with the Bureau for Food and Agricultural Policy (BFAP) shows that maintaining the sugar tax at the current level will still cost the industry a further 15 984 seasonal and permanent jobs and will be a major contributing factor towards a decline of 46 600 hectares of area under cane over the next 10 years. However, there would have been even further job and revenue losses if the planned increase had gone ahead today,” said Funke.
The increase would have exacerbated challenges the industry already faces as a result of rising input costs, including price hikes in diesel fuel (currently 40% above the price in March 2021 and expected to go a lot higher) and fertiliser, the cost of which has increased more than 160% when compared to last year.
“It is critical that the government focuses on assessing the long-term implications of keeping the tax in place. SA Canegrowers will continue to engage the government and to call for further research into the impact of the tax on obesity levels, jobs and revenue from 2018 to date,” added Funke. SA Canegrowers remains committed to the protection of 1 million livelihoods that the sugar industry supports. “… the only way to achieve this is to scrap the sugar tax and to take into account all factors that contribute to obesity.”