Tax incentive introduced in SA for conservation of rhino and lions – but economist calls it ‘flimsy’

A tax incentive for environmental conservation has been introduced in South Africa through collaboration between the Department of Forestry, Fisheries and the Environment (DFFE), the Sustainable Finance Coalition (the Coalition), and implementation by Wilderness Foundation Africa (WFA). They have executed the country’s first tax incentive for threatened species, such as rhino and lion.

Biodiversity management agreements

The initiative, based on the country’s first-ever biodiversity management agreements (BMAs) between the Minister of the Environment, Barbara Creecy, and South African taxpayers. These BMAs allow South Africans to direct some of the tax they pay to go towards conservation efforts.

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The initial BMAs are being implemented in Limpopo, where landowners are using the Candidate Other Effective Area-Based Conservation Measure (OECM) to access this innovative tax deduction.

‘It won’t make much difference’

However, economist Dawie Roodt told The Citizen this is not something new, as South Africans were already able to deduct a percentage of their taxable income from donations.

“A much better approach would be to do something else like protect private property rights, which will include allowing people that are owners of rhino to sell their rhinos, including their horns, as an example. That will do much more to protect in the end because it will give rhinos actual monetary value rather than these flimsy tax incentives that won’t make much of a difference, I am afraid,” he said.

South Africa, in line with the global commitment established by the Kunming-Montreal Global Biodiversity Framework (GBF) in December 2022, is working towards biodiversity conservation targets, including scaling up positive incentives for conservation.

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Impact on conservation and finance

Candice Stevens, CEO and Chairperson of the Sustainable Finance Coalition, emphasised the dual impact of this tax incentive. It not only provides a financial solution for conservation but also contributes to national conservation goals, particularly the 30×30 targets.

The 30×30 conservation goal aims to have 30% of the world’s land and water areas to be protected by 2030.

Tax incentive

The tax incentive is anticipated to unlock approximately R1.5 million annually for the conservation and maintenance of threatened species and ecosystems. This incentive offers a financial benefit for South Africans that contribute to the protection of the country’s natural heritage.

The tax incentive for threatened species was incubated in 2020, piloted by Wilderness Foundation Africa, and received funding from the Rhino Recovery Fund in 2021 and 2022.

READ ALSO: Kruger Park records ‘steady decline’ in rhino poaching

Eligibility and deduction details

Ellané van Wyk, Lead for Finance Solution Incubation and Implementation for the Coalition, said that people that donate towards the conservation and maintenance of threatened species and ecosystems may be eligible for the tax deduction. This includes expenses such as alien-clearing, ranger salaries, security, veterinary costs, or member levies contributing to conservation and maintenance activities.

The tax incentive aims to bridge the conservation finance gap, benefiting both landowners and the preservation of South Africa’s unique biodiversity.