Reversal on Sugar Tax increase a welcome reprieve for sugarcane growers 

22 February 2023  

SA Canegrowers welcomes the announcement in today’s Budget Speech of the decision not to implement a planned increase in the Health Promotion Levy. With the many serious challenges currently facing South Africa’s growers, the increase would have decimated the industry, costing the country much-needed jobs.

Minister Godongwana’s decision to maintain the Health Promotion Levy at its current level for another two years was in recognition of the difficult operating environment for the industry. With the industry facing more than R700 million in lost revenue due to loadshedding, a milling crisis, and the impact of the recent floods, this intervention was vital.

Minister Godongwana had originally announced an increase in the Health Promotion Levy in his 2022 Budget Speech. The increase, due to take effect on 1 April 2022, was later postponed to 1 April 2023. The implications of this increase would have been devastating for the industry. This reversal therefore marks a critical reprieve for the growers, value chain partners, and the one million livelihoods they support

SA Canegrowers will continue to monitor the implementation of the interventions to mitigate the impact of loadshedding as well as the rollout of the relief effort under the State of Disaster on the recent flooding. However, growers are nevertheless grateful for the decision not to increase the sugar tax as a major step in creating a stable environment for the industry.

SA Canegrowers is hopeful that this two-year reprieve will also be used to foster further engagement about the effectiveness of the Health Promotion Levy and the possibility of crafting alternative, less destructive and holistic health interventions. At the same time, growers will use opportunity to revive the industry, and to position it for long-term profitability and sustainability.

Issued by Kabelo Kgobisa on behalf of SA Canegrowers, 22 February 2023