Last month’s Medium-Term Budget Policy Statement (MTBPS) did not indicate an increase to the Health Promotion Levy (HPL), better known as the sugar tax, in the 2026 Budget, with industry organisation the South African Cane Growers’ Association (SA Canegrowers) noting that this afforded South Africa’s sugarcane growers a “small measure of relief”.

“When the sugar tax was first introduced in April 2018, 16 000 jobs were lost in the first year alone. But this year, the landscape for South African sugar has changed dramatically,” SA Canegrowers chairperson Higgins Mdluli stated after the MTBPS’s release.

The HPL was first introduced in a year with relatively low levels of imported sugar entering South Africa and two years before the Covid-19 pandemic, becoming the “norm” up until 2025.

Mdluli explained that the association has since seen a 400% increase in imported sugar, which has displaced locally grown sugar from retail shelves and in commercial food and drink producers’ inputs.

Further, the 149 000 t of imported sugar will “undoubtedly” have a dramatic effect on the local industry’s ability to remain a stable employer in rural Mpumalanga and KwaZulu-Natal.

He noted that “any increase in the sugar tax would [exacerbate] an already dire situation”, adding that the industry is concerned that the influx of imported sugar will lead to job losses and economic hardship.

The association pointed out that the fact that government has not amplified existing pressures by raising the tax “comes as a relief”, but industry still requires a more proactive approach from government to safeguard jobs and drive growth.

SA Canegrowers vice-chairperson Andrew Russell explained that the association has repeatedly asked National Treasury to scrap the sugar tax, in addition to asking the Department of Trade, Industry and Competition to adjust the existing tariff policy framework to “keep up with global realities”.

“This call is now even more urgent. The added cost of the sugar tax on beverage producers has made imported sugar more appealing, thereby punishing local growers even further,” stated Russell.

Mdluli added that, since the sugar tax’s implementation, there has yet to be any data or studies that demonstrate that it has had any impact on reducing national obesity levels, lowered rates of diabetes or led to a healthier population, suggesting that the tax has failed to meet its stated objectives.