The Congress of South African Trade Unions (Cosatu) presented their submissions on the Treasury’s Proposed Tax on sugar-sweetened beverages (SSB) to the National Assembly’s Portfolio Committees on Finance and Health’s public hearings in Parliament on Tuesday.
Cosatu agreed with the government that the over consumption of SSB is a national health crisis, but they are equally worried about the economic impact the proposed tax might have and that it is likely to result in thousands of job losses.
A presentation by the South African Institute of Chartered Accountants (SAICA) presented by Pieter Faber and Madelein Grobler on the effectiveness of behavioural taxes said that the purpose of tax on SSB is “to address obesity by changing consumers behaviour to consume sugar-sweetened beverages,” they also added that “it is not to collect revenue to compensate or fund anti-obesity or health projects.”
A document by Cosatu said: “We agree with government that we need to act and the sooner, the better. Reducing our consumption levels of sugar will save lives and reduce health expenditure,” however while being in full support of the government and it’s health objectives, Cosatu is deeply concerned about the effect the SSB tax will have on jobs, “Treasury estimates it will cause 5,000 job losses.”
SAICA referenced research on sugar addiction done by the Tim Noakes Foundation in September 2016 stating, “it’s not the cost of sugar that’s the problem, the real issue boils down to the fact that most people are unaware of the hidden sugar contents in food and are still unsure of how to read labels”.
The South African Medical Association (Sama) along with The Heart and Stroke Foundation said that the tax in itself will not be the solution or sufficient unless it is combined with other interventions.
Cosatu Parliamentary Coordinator, Mattew Parks said: “We hope they [parliament] will go a long way towards achieving a win-win consensus approach to this critical matter.”
“Our concern is based upon an unemployment level of 36%, jobless growth, thousands of workers losing their jobs month after month and government’s inability to create jobs.”
Cosatu sees the fact that the SSB tax is being run by Treasury with the Department of Health in a supporting role as a further warning sign that the tax has not been well planned.
“It’s shocking that government can go into great detail about how to raise billions of Rands through the SSB tax yet it cannot produce a plan to save 5,000 farm workers’ jobs,” he said.
– African News Agency