Food and beverage industry gets sweetened deal with tax relief

The comment period for the proposed tax on sugar-sweetened drinks closed last week. The plan is to implement this tax on July 1.

Finance minister Pravin Gordhan announced a proposed tax on sugar-sweetened drinks in his February 2017 budget speech.

After much deliberation on the 140 comments received during public hearings in Parliament, National Treasury revised the proposed tax on sugary beverages.

Ismail Monomiat, Deputy Director-General of Treasury, says there were submissions from health experts as well as some representatives from the industry.

The health experts felt that we should in fact have a higher rate tax on sugary beverages... The industry was concerned about the loss of jobs.

Ismail Monomiat, Deputy Director-General of Treasury

When we took the comments into account, we decided that we will come in at a slightly lower rate and we will exempt the first four teaspoon of sugar in a can of soft drinks.

Ismail Monomiat, Deputy Director-General of Treasury

Priscilla Urquhart, Public Affairs and Communications Manager at Peninsula Beverages says the food and beverage industry welcomes the decision by Treasury to reduce the tax on sugary beverages.

She says they also recognise and acknowledge the health concerns associated with obesity.

To hear more about tax on sugary drinks, please listen below:

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