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Delta Pays US$20 Million Sugar Tax In 9 Months

4 months agoFri, 08 Nov 2024 13:25:09 GMT
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Delta Pays US$20 Million Sugar Tax In 9 Months

Delta Corporation Limited has paid US$20 million in sugar tax since the tax’s introduction in February 2024.

The tax, which came into effect at the start of 2024, charges beverage firms US$0.02 per gram of sugar in their products. In response to industry complaints, the tax was revised in March to US$0.001 per gram.

Delta executives have stated that the sugar tax has made the company less competitive within the region, particularly when comparing it to tax rates in neighbouring countries.

The full impact of the sugar tax on Delta’s financial performance will be felt in the financial year ending March 31, 2025, alongside other existing taxes.

At an analyst briefing on Wednesday, Delta’s CEO, Matlhogonolo Valela, told NewsDay that the sugar tax in Zimbabwe is considerably higher than that in other regional markets. Said Valela:

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Well, since February, between ourselves and Schweppes, we have paid about US$20 million in sugar tax.

Obviously, the rates of sugar tax, we think, are very high compared to regional compatriots. Therefore, it brings a competitiveness issue.

That’s why you are seeing regional inflows of similar competing products into our territory. It is on the basis that we are slightly more expensive than what people can source from alternative markets around us.

Delta has a 49% stake in Schweppes Holdings Africa Limited.

Valela said Delta is in talks with the government regarding the sugar tax, but any potential outcomes from these discussions are expected to be reflected in the 2025 National Budget.

Delta’s finance director, Alex Makamure, said the introduction of the sugar tax led the company to raise soft drink prices by 33%, which has hurt consumers. Said Makamure:

So, it is a big tax from the rate at which it was imposed. So even at that US$0,001 per gramme, it is very high relative to other countries.

So, all our pleas to the government have always been, yes, it’s noble to introduce a sugar tax, but maybe look at the level…

Remember for us, your 300ml Coke was selling at US$0,25 or US$1 for four. We had to move to US$1 for three, which is a 33% increase. Quite huge from a consumer’s point of view.

Schweppes, for example, they were selling your 2-litre Mazowe at, I think it was, US$3,20 or U$3. They went to US$4.50.

They have sort of discounted, and now they are carrying some of the burden themselves. But it is very significant, particularly for your dilutable.

Makamure said that Delta has no issue with the introduction of the sugar tax, but argued that it should be set at a level that minimises its impact on consumers while still encouraging a reduction in sugar consumption.

More: Pindula News

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18 Comments

Mujubheki · 4 months ago
and that Delta co WhatsApp group irikutodiwa kuti ibhadhare tax futi
Rurue · 4 months ago
sorry Delta co. you will be happy to have a good rate for it when presdent Nelson madyirapadze wegona chitova chamisa ava pachigaro cheushe potse kusatobhadhara inodarika ½cent
...,. · 4 months ago
the whole company will see it better and more profitable for them to import finished products from sister companies. jus like with Unilever (Lever Brothers), Chippies, Nampack etc, they will press the exit button, maybe soon to be followed by Pick 'n Pay.
BBC · 4 months ago
usataure zvausingazive
annie · 4 months ago
I remember Ian Smiths speech, sitting with my dad listening but at 17 years of age I didn't realise what the consequences would be
Rhodesian Independence · 4 months ago
11 November is national day Rhodesia will never die in our hearts We will always cherish it Monday happy Rhodesian nationhood fay
Sol Regem · 4 months ago
Tax and more taxes to finance the lavish lifestyles of the ruling elite. Ponder This 👇👇 Zimbabwe and Zambia have almost identical health budgets but the Zambian health sector is much more efficient and well stocked than the Zimbabwean one despite Zambia having more people than Zimbabwe, you are left to wonder what is the problem with the Zimbabwean side of things, allocated money isn't used for what is allocated for instead it is diverted for someone's else benefit, very shameful from the Zimbabwean Authorities.
Zero · 4 months ago
10 million was given to Chivhayo who come up with this idea of sugar tax
Patriot chairo · 4 months ago
With these tax hungry government inogona kutokwidzwa. Chasara kunzwa kuti they are taxing ladies of the night.
??? · 4 months ago
Rino igore rema tax, umwe arudawo ye whatsapp
LTM · 4 months ago
where is tax payers money going??
zig · 4 months ago
everything will shutdown on it's own way
Sir African · 4 months ago
Mnangagwa and Masisi booed at the inuagration of Boko.
shurushuru · 4 months ago
tsvatu waro. richinyanya 😃
Freedom · 4 months ago
Sir African please tell us more about this wonderful incident
jah d · 4 months ago
taxes everywhere kkkk
Sir African · 4 months ago
What would you expect a sissy pot?More pain and less joy for the peopl.

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