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Sugar-sweetened beverage (SSB) tax in South Africa: an analysis of the tax design.

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Sugar-Sweetened Beverage (SSB) tax has stirred considerable debate both locally and internationally in the recent years and this dissertation explores some of these issues. The tax was announced in South Africa by former Minister of Finance Pravin Gordhan in the February 2016 Budget as a measure to reduce the prevalence of obesity, non-communicable diseases (NCDs) and excess sugar consumption. The tax was initially set at a rate of 20% and due to backlash from members of the beverage industry, the tax rate was reduced to 11%; and a tax threshold was set exempting the first 4 grams of 100ml of sugar contained in SSBs. Therefore, many soda companies have embarked on reformulation of their products to reduce the added sugar content levels contained in their beverages; in order for them to be classified as „tax-exempt‟. The opposition from the beverage industry stems from the potential job losses that the proposed tax may create. The tax is analysed as a form of „sin tax‟ and the Policy Paper indicates a vast array of similarities to the objectives, structure and design of the excise taxes on alcohol and tobacco. International studies on the effect of SSB tax have indicated a positive correlation leading to the reduction of SSB sales and consumption; (Mexico and Berkeley, California); which in turn leads to a reduction in the prevalence of obesity and other NCDs. France indicated a reduction of sales in the non-alcoholic beverage sector and the SSB tax design in the United Kingdom has many similarities to the proposed tax design in South Africa. The principles of an effective fiscal health policy and tax design suggested by the Davis Tax Committee and the World Health Organisation (WHO) indicate that South Africa‟s tax design will be effective in order to achieve the fiscal health objectives. The alternatives to SSB tax suggested by members of the beverage industry include; reformulation of SSBs, food labeling, and consumer education. Ultimately, SSB tax should be implemented together with a comprehensive package of policies in order to achieve the fiscal health objectives and to mitigate against potential job losses.


Master of Laws. University of KwaZulu-Natal, Durban, 2018.


Theses - Law.