Sugarcane industry faces threat from South Africa's sugar tax

Published 2024년 6월 6일

Tridge summary

South Africa's sugar tax, introduced in 2018, has led to the loss of over 16,000 jobs in the local sugar industry, as reported by the canegrowing association. The tax, aimed at reducing sugar consumption, has had a domino effect, affecting not only the beverage industry but also the sugar production sector, which is vital for one million livelihoods in rural communities. The industry already faces challenges such as drought, cheap imports, and global price drops. Despite a two-year delay in increasing the levy, there are plans to expand it to more beverages. The industry is exploring alternative routes for growth and sustainability, but the sugar tax is seen as a barrier to investment and transformation.

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Original content

The canegrowing association says the sugar tax has suppressed the market for locally produced sugar and cost the industry more than 16,000 jobs. South Africa became the first country on the continent to introduce a sugar tax in 2018 as the Health Promotion Levy. The sugar tax applies to drinks with more than 4g sugar per 100ml. While US opponents often criticize sugar taxes for their economic impact on jobs in the beverage industry, in South Africa the impact goes further back in the supply chain to the raw material. South Africa is a large sugar producer: with the industry consistently ranking in the top 15 sugar producing countries worldwide. Furthermore, it’s the lifeblood of many rural communities (data from the South African Sugar Association says one million livelihoods depend on it). But the industry has already been facing huge challenges for several years: ranging from prolonged drought to cheap sugar imports and lower sugar prices globally. Add on to that the Health ...

Source: Beveragedaily