Johannesburg (27 November 2017) – An extraordinary move by the National Council of Provinces Select Committee on Finance could sabotage the chances of the tax on sugary beverages being included in the Minister of Finance’s 2018/19 Budget.
The Rates and Monetary Amounts and Amendment of Revenue Laws Amendment Bill, which provides the statutory foundation for the tax, was passed in the National Assembly last week.
Since this is a money bill, it is processed by parliament in the same way as a bill that does not affect provinces. This means that, although the bill is referred to the NCOP, members of this chamber cannot prevent the National Assembly from adopting the legislation.
Therefore, the decision by the NCOP Select Committee on Finance to hold three days of hearings on the bill – from Tuesday to Thursday this week – is extremely unusual, especially parliament goes into recess on 6 December. In addition, the Select Committee failed to issue any public call for submissions and only had two parties that are opposed to the tax set down on the Order Paper to make submissions.
“We can’t help suspecting that the committee has an agenda to stall the bill and prevent Treasury from introducing the sugary drinks tax in April,” says Tracey Marawana, coordinator of the Health Living Alliance (HEALA).
“Our suspicions are reinforced by the fact that the only two non-government stakeholders scheduled to address the NCOP committee were BEVSA and Tiger Brands, both of which have a vested interest in delaying the tax.
“HEALA virtually had to force its way onto the committee’s agenda in order to argue the case for the tax, which is South Africa’s first national policy measure to tackle the obesity epidemic that is costing this country dearly in lives lost, massive healthcare costs and lost productivity.”
Once the NCOP has dealt with the Bill, it will be referred back to the National Assembly for a final decision and, assuming the Assembly assents, it then goes to the President for signing. With the Budget speech due to take place on 21 February, a delay at any stage could force Treasury to drop the tax from its revenue estimates for the coming year.