The South African Sugar Association (Sasa) believes there has been insufficient public involvement in discussions on the implementation of the proposed tax on sugar-sweetened beverages.
Finance Minister Pravin Gordhan on Wednesday confirmed that the proposed tax, which will be levied at a rate of 2.1c/g of sugar content in excess of 4 g/100 ml, will be implemented later this year, after the relevant legislation is passed.
“It is inevitable that the imposition of the tax will negatively affect both the milling and sugarcane agricultural sectors of the local sugar industry. Loss in revenue and a reduction in sugar consumption will result in a shrinkage of the industry with accompanying job losses,” Sasa chairperson Rolf Lütge said in a statement.
He added that the sugar industry is under siege owing to a devastating drought, inadequate import tariff protection and other external factors.
The proposed tax, he noted, will compound matters and threaten the survival and sustainability of the industry.
“The sugar industry provides about 85 000 direct jobs, which represents over 11% of the total agricultural workforce in South Africa. Indirect employment is estimated at 350 000 jobs. Approximately 1% of South Africa’s population depend on the sugar industry for a living,” Lütge said.
Sasa contends that sugar is not responsible for obesity, as claimed by government.
The statement added that a full assessment of the causes of obesity and noncommunicable diseases, in South Africa, needs to be undertaken, as should a proper socioeconomic impact study to determine the extent of the impact of the proposed tax on affected industries.