The African National Congress Women’s League (ANCWL) said on Wednesday that it was opposed to the proposed tax on sugar-sweetened beverages, saying that the tax would have a negative impact on the economy and result in job losses.
The government reduced the proposed tax on sugar-sweetened beverages from 20 to around 11 percent on a can of Coke after industry raised concerns about unintended job losses. They estimated that up to 60 000 jobs could be lost as a result of the tax.
Another concern was that any loss of production in affected industries could, in turn, reduce their contribution to GDP by as much as R14 billion.
The proposed tax on sugar-sweetened beverages is aimed reducing consumption of these drinks, and thus curb non-communicable diseases, especially the country’s high obesity rate.
Though it supports the quest towards a healthy nation, the ANCWL said the league did not believe that introducing tax on sugar-sweetened beverages was a panacea to deal with obesity and other non-communicable diseases.
“There is an estimated number of 60 000 jobs to be lost due to the implementation of tax on sugar sweetened beverages,” warned ANCWL Secretary General Meokgo Matuba in a statement.
“The consequences of trade agreements such as AGOA [African Growth and Opportunity Act] has contributed in more job losses in the chicken industry and the government should not allow a similar situation in any sector. South Africa cannot afford any job losses in all sectors.”
Matuba said the ANCWL was calling for a more comprehensive dialogue on the proposed tax to mitigate the unintended consequences, saying there should be alternative measures to address the obesity challenge and associated diseases.
“Government must look at other mechanisms such as instructing sweetened beverages companies to reformulate their products and reduce the sugar content,” Matuba said.
“In order to avert job loss and not derail the program of ‘radical economic transformation’ in the sugarcane growing sector and the milling industry, and to find solutions on the challenges of obesity and related noncommunicable diseases, the ANCWL calls for further engagements on the current Bill which seeks to introduce tax on sugar sweetened beverages.”
Matuba said the fight against obesity and noncommunicable diseases must be intensified, but not at the expense of job losses and economic marginalisation of black people who are in sugarcane sector and milling industry.