Recent calls by some public health sectors to double the Health Promotion Levy (HPL) or ‘sugar tax’ as it’s commonly referred to, is worrying according to SA Canegrowers.
The association says one million people rely on the sugar industry for their income, and the doubling of the HPL will lead to more rural job losses.
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It also says studies show the HPL has little discernible impact on the country’s obesity levels.
While health groups claim the HPL has had little impact on employment levels in the sugar industry, a report commissioned by the National
Economic Development and Labour Council (Nedlac) shows the exact opposite to be true.
The report titled Economic Impact of the Health Promotion Levy on the Sugar Market Industry, shows that in the first year of the sugar tax’s implementation there were 16 621 job losses across the industry and 9 000 job losses in the cane growing sector alone.
Most of these job losses have been in communities living in rural areas where poverty levels are the highest.
The report also highlighted that the sugar farming sector’s output had declined by a cumulative R414.2-million by 2019 as a result of the sugar tax (2018 – R214.7-million and 2019 – R199.5-million), while the sugar processing sector’s output had declined by a cumulative R772.1-million by 2019.
The sugar tax also resulted in a R653-million decline in investment into the economy.
Perhaps the reason for the group of scholars downplaying the devastating economic impact of the sugar tax to date is that the majority of them are based at overseas universities and therefore do not understand the dire economic situation in which our country finds itself, with unemployment at 44.4%, or the hardships that so many rural people face.
While the group presents two studies that tracked young adults’ intake of taxable sugar sweetened beverages in Langa, Western Cape and Soweto,
Gauteng as evidence that the sugar tax has had a positive impact, there is still little or no evidence that it has had a positive impact on obesity levels in the country.
This is despite the sugar industry making numerous requests to government to commission a study to measure whether the tax has achieved its objective of improving health.
The fact is that without jobs, people struggle to provide their families the health and nutrition they need. It is, therefore, in everybody’s interest that rural jobs are protected.
SA Canegrowers remains committed to continue working with government to achieve the commitments of the SA Sugar Cane Value Chain Masterplan, to ensure a more diversified and sustainable sugar industry.
However, to achieve this, it is critical that we safeguard the livelihoods of both commercial and small-scale growers, emergent farmers and thousands of workers living in rural communities.
