Sugar Cane Producers in South Africa Applauds 12-month Postponement of New Levy

Sugar cane producers in South Africa said Finance Minister Enoch Godongwana‘s announcement of a 12-month postponement in the sugar tax.

The rise, which was supposed to take effect on Monday, was expected to raise the sugar tax from 2.21 cents per gram of sugar to 2.31 cents per gram of sugar, as indicated by the minister in his February Budget Speech, has been tagged a relief to the country’s small scale farmers.

The rise, according to the group, would have compounded the industry’s already-existing problems caused by growing input prices. Not only is the current diesel fuel price 40% more than it was in March 2021, but it is predicted to rise considerably more, while the cost of fertilizer has risen by more than 160 percent since last year.

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“While [the] news gives some short-term relief to farmers,” the group stated in a statement, “it is vital that the government focus on examining the long-term ramifications of retaining the tax in place.”

Despite the government’s failure to offer any proof (to date) that the sugar tax has had any impact, the organization claims that the first year of the tax lost the country approximately 16 000 jobs and R2.05 billion.

According to the organisation, the sugar tax cost the country more than 16 000 jobs and R2.05 billion in its first year, notwithstanding the government’s failure to show any proof (to far) that it has reduced obesity.

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