Delta Pays US$21 Million in Sugar Tax, Sparking Public Outcry
Delta Corporation says it paid a hefty US$21.1 million in sugar tax last year, even as it reported a 5% increase in revenue to US$807.4 million for the year ending March.
In their latest financial update, CEO Matlhogonolo Valela and finance director Alex Makamure said growth was slowed down by weak performances in South Africa and Zambia, along with the strain of the sugar tax on soft drinks.
The Soft Drinks Industry Levy (SDIL), which charges US$0.001 per gram of added sugar, hit Delta hard. Of the total tax bill, US$14.7 million came from the soft drinks business alone.
To protect consumers from rising prices, Delta chose to absorb the tax instead of passing it on. But that decision hurt the company’s margins and dented profits. At the same time, higher prices on local products opened the door for cheaper imports to flood the market.
The Zimbabwean government introduced the sugar tax to fight obesity and fund cancer treatment equipment. Initially pegged at US$0.002 per gram, the rate was later reduced by half.
But after Delta disclosed the amount it paid, many Zimbabweans expressed doubt over where the money is going, especially given the ongoing crisis in public healthcare.
Here are some of the comments:
@Blessing_Museki:
US$21.1 million sugar tax from one company alone – supposedly to help with the nation’s health. But we have national hospitals in a state of disrepair.
@tashymanyere:
That $ 21 million in sugar tax will not do anything for the citizens
@Norman30434448:
Let it be known that the old chip Delta is no more. They are failing to supply the market & competition is eating them…DIVEST
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The post Delta Pays US$21 Million in Sugar Tax, Sparking Public Outcry appeared first on iHarare News.
