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South African Revenue Service to collect sugar tax from April

Photo: Supplied

Photo: Supplied

The South African Revenue Service (SARS) announced on 15 December, they will collect the Sugary Beverages Levy (SBL) as from 1 April 2018. The levy is part of government’s programme to prevent and control non-communicable diseases and assist in the prevention and control of obesity.

It falls under the Rates and Monetary Amounts and Revenue Laws Amendment Bill 2017, as passed in Parliament on 5 December 2017. The levy is fixed at 2.1 cents per gram of the sugar content that exceeds 4 grams per 100ml which means the first 4 grams per 100ml are levy free.

According to SARS, licensing and registration of manufacturers of sugary beverages will start from February 2018 and only commercial manufacturers that produce sugary beverages with a total annual sugar content in excess of 500kg per year need to be licensed and pay the levy. Non-commercial producers below this threshold will be expected to register but will not be subject to the Sugary Beverages Levy.

Imported products will be taxed when they are cleared for home consumption and locally manufactured products will be taxed at source. SBL returns and payments can be submitted electronically through SARS eFiling and will also be accepted at Customs and Excise branches.

Tracey Malawana, coordinator of Healthy Living Alliance, says South Africans are among the top 10 consumers of sugary drinks in the world. She says diabetes claimed more than 25 000 lives in 2015 and public health facilities reported seeing 10 000 new diabetes cases every month last year.

“Taxes on sugary drinks have been an effective measure for reducing the consumption of sugary drinks and are recommended by leading global and South African public health experts. We applaud members of Parliament for putting the health of millions of South Africans before the interests of the beverage and sugar industries,” says the coordinator.

According to Malawana, while the tax is a victory for public health, it is around 11% on a can and we would like it to be strengthened to 20% to really deter people. She says they will also be monitoring how the proceeds of the tax are used to ensure that government uses the money for health promotion.

“Thanks to Treasury and MPs, South Africa is on the right path to reverse the alarming numbers of diabetes cases and other non-communicable diseases associated with obesity. It is a critical element of a comprehensive plan including other policies and programs to reduce obesity and related diseases in South Africa,” says Malawana.