The South African Poultry Association will continue to campaign for chicken to be exempt from value-added tax (VAT) because it believes it is in the interests of the country and lower-income households, it said in a statement on Tuesday.
SAPA is disappointed that the Woolard panel did not recommend the zero-rating of chicken.
A final decision on any additional products to be zero-rated will probably be taken later this year, and SAPA intends to contribute vigorously to the public debate.
“Our argument will be based on the detailed submission made to the panel, supported by an economic and regulatory analysis prepared by our advisers, PricewaterhouseCoopers (PwC),” it said in a statement on Tuesday.
The thrust of the submission is that chicken is the primary protein source for poor people and should not be subject to VAT.
“The most money spent by lower-income households is on chicken as a food item,” the submission says.
As the panel has noted, measures can be put in place to limit the zero-rating to the chicken products most consumed by poor people.
“We proposed zero-rating only “chicken on the bone” to ensure targeted relief for poor households, excluding deboned meat and other products bought by wealthier consumers.”
The panel gave some consideration to zero-rating only individually quick frozen portions.
“We believe both these options would benefit the poorest sections of our population, and deserve careful consideration in the months ahead.”