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The Star
21-05-2025
- Business
- The Star
BUDGET: SA Canegrowers welcomes no increase in sugar tax
SA Canegrowers on Wendesday said that it welcomes the decision by Finance Minister Enoch Godongwana not to enact any further increases in the Health Promotion Levy (or sugar tax) in his Budget 3.0. "Introduced in 2018, the sugar tax cost 16 000 jobs and R2 billion in revenue in the first year of implementation alone, according to independent research by Nedlac. Any increase would risk the livelihoods of growers and increase unemployment in many parts KwaZulu Natal and Mpumalanga, where there are few other job opportunities," SA Canegrowers said. " The sugar tax has been nothing but destructive for South Africa. While the Nedlac study demonstrated concrete proof of job losses, no evidence has been provided to show the tax has reduced obesity or improved the health of South Africans in any way," it further stated. The association said it believes that Treasury should scrap the tax, to help ensure that government drives job creation and economic growth, as per its commitments outlined in the Sugarcane Value Chain Master Plan 2030. "This social compact between industry and government to revitalise the industry also has the potential to create new markets for sugarcane growers and kickstart new industrialisation projects in Mpumalanga and KwaZulu-Natal," Canegrowers said in a statement. "Agricultural jobs are critically important to the stability of South Africa and to making sure that we reduce rural poverty and hunger. SA Canegrowers will continue to strive for an end to this job-killing tax, calling on the government to prioritise desperately needed economic growth and jobs instead," it further said.
IOL News
21-05-2025
- Business
- IOL News
How the business sector reacted to Budget 2025: Stability measures and growth concerns
Minister of Finance, Enoch Godongwana, delivered the 2025 Budget Speech during the National Assembly plenary at the Cape Town International Convention Centre Image: Phando Jikelo/ Parliament of SA The country's business community has given a measured response to Finance Minister Enoch Godongwana's 2025 Budget, welcoming spending discipline and the avoidance of new tax hikes, while urging faster reforms to address sluggish economic growth. Godongwana delivered his third attempt at the national budget on Wednesday after two earlier proposals were rejected, largely due to political disagreements over a controversial 2% increase in Value Added Tax (VAT). In his speech, Godongwana emphasised the government's commitment to maintaining sustainable public finances, despite challenges. "Nevertheless, this budget supports sustainable finances, the social wage and investments in economic growth. This is not an austerity budget," Godongwana said. The budget also included an increase in the fuel levy, with petrol rising by 16 cents per litre and diesel by 15 cents per litre. The minister said this measure was intended to boost revenue, adding that the government was focused on enhancing revenue collection, particularly by addressing unpaid taxes and combating illicit trade. Despite some positive reactions, SA Canegrowers welcomed the decision not to increase the sugar tax but called for its complete removal, citing job losses and no proven health benefits. "The sugar tax has been nothing but destructive for South Africa. While the Nedlac study demonstrated concrete proof of job losses, no evidence has been provided to show that the tax has reduced obesity or improved the health of South Africans in any way," the organisation said "Ultimately, we believe that Treasury should scrap the tax, to help ensure that the government drives job creation and economic growth, as per its commitments outlined in the Sugarcane Value Chain Master Plan 2030" Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. 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Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ Chamber of Commerce flags fiscal risks Jacques Moolman, President of the Cape Chamber of Commerce and Industry, also welcomed the reversal of the VAT hike but raised concerns about the fuel levy's knock-on effects and long-term fiscal risks. "It was encouraging to hear Minister Godongwana reiterate the urgent need for public-private partnerships, and we welcome continued efforts to expedite this process in order to facilitate much-needed economic growth". He warned that South Africa was 'tethering far too long' on the edge of a fiscal cliff, with the national debt-to-GDP ratio posing a serious risk to economic recovery. "In our view sustainable growth is the only way for South Africa to avoid falling over the edge of the fiscal cliff, where we have been tethering for far too long. Our debt-to-GDP ratio forecast remains a huge concern, with the potential to derail efforts to get our economy back on track. "Although budget cuts in some areas were inevitable, we believe the R66-billion over three years earmarked for PRASA will help alleviate the economic disruption caused by disintegrating public transport networks. Provision of affordable and efficient public transport is fundamental to future economic growth". Moolman also noted the timing of the budget, which coincided with a significant diplomatic engagement in Washington between President Cyril Ramaphosa and US President Donald Trump. "The Cape Chamber is mindful that Wednesday's budget coincides with a crucial diplomatic engagement in Washington involving President Cyril Ramaphosa and President Donald Trump. A positive outcome in Washington would go a long way towards quelling market jitters around economic ties with one of our biggest trading partners". CEO at SolarAfrica David McDonald said the minister's budget was a breath of fresh air renewable energy sector. "Today's Budget was a breath of fresh air for the renewable energy sector, with R219.2 billion allocated to strengthening South Africa's electricity supply network - from generation to transmission and distribution. "The explicit recognition that renewable energy projects are helping to stabilise power supply and reduce loadshedding affirms the role that Independent Power Producers (IPPs) like SolarAfrica play in building energy resilience," IOL Business Get your news on the go, click here to join the IOL News WhatsApp channel
