Sugarcane industry organisation SA Canegrowers has written to the chairperson of Parliament’s Standing Committee on Finance requesting oversight into the National Treasury’s policy-making regarding the Health Promotion Levy (HPL), which is also known as the sugar tax.

The organisation says this request comes after the Treasury failed to respond to a request under the Promotion of Access to Information Act to provide the reasoning behind the ongoing implementation and the planned increase of the levy.

The sugar industry has struggled for close to five years under the yoke of an unsubstantiated health intervention with no evidence whatsoever of its effectiveness. However, there is ample evidence regarding how the continued implementation of the levy threatens the future sustainability of the industry and the one-million livelihoods it supports, says SA Canegrowers chairperson Andrew Russell.

"This request has also been made ahead of Finance Minister Enoch Godongwana delivering his 2023 Budget Speech this week. The Minister is expected to announce whether the increase in the HPL will take effect on April 1, 2023, as previously announced," he adds.

The sugar industry, like much of the national economy, suffers the effects of crippling loadshedding, high inflation and deteriorating infrastructure exacerbated by recurring floods. With the additional hardship occasioned by a crisis in the milling industry, maintaining the Health Promotion Levy is not sustainable and increasing it would be unconscionable, says Russell.

"Our Constitutional framework envisions transparent and accountable governance, and Parliament’s committees play a critical role in this regard. The failure of Treasury to deal transparently with the sugar industry is disappointing and requires the intervention of the Standing Committee on Finance," he notes.

The South African Sugar Association released findings that showed that the planned increase in the HPL would cost the sugar industry more than 6 000 jobs and jeopardise the businesses of nearly 3 000 small-scale growers. This adds to the total of more than 16 000 jobs and R2-billion lost because of the levy in the first year of its implementation alone.

Additionally, data compiled by SA Canegrowers showed that growers were expected to lose more than R700-million in 2023 owing to the implementation of loadshedding at Stages 4 to 6. This could rise to R1.8-billion if loadshedding escalates to Stages 6 to 8, he highlights.

"SA Canegrowers continues to urge Minister Godongwana to help us save vital livelihoods in South Africa’s rural economies by scrapping the sugar tax, and to work with the industry and other social partners to devise less destructive ways to promote health in South Africa than the job-killing HPL," Russell says.