Health Promotion Levy on Sugary Beverages
The Health Promotion Levy HPL on Sugary Beverages external policy has been revised to align with the relevant sections of the Act.
Any person who manufactures or imports any sugary beverage that is liable for HPL must determine and declare the sugar content of the sugary beverage based on:
1. The total sugar content in grams per 100ml of the sugary beverage as certified on a valid test report obtained and retained from a testing laboratory. The Laboratory should be accredited with and uses methodology recognised by the South African National Accreditation System (SANAS) or the International Laboratory Accreditation Cooperation (ILAC); and
2. The report referred to in item (i) above must be kept available for inspection for a period of five (5) years from the date that the sugary beverage was manufactured or imported and must be produced or submitted at the request of an Excise Officer (EO); or
3 The sugar content that is used for the calculation of the SBL liability is either the actual sugar content of the SBL item as substantiated on an acceptable laboratory test report or the deemed sugar content of 20 gram for 100ml. The declaration of the sugar content in respect of an SBL good with a deemed sugar content must therefore be reflected as 20 gram for 100ml on the DA 179. In practice, the system will apply the normal SBL calculation that first subtracts the threshold of 4gram per 100ml exempt sugar content from the declared sugar content in the calculation of the final SBL liability; and
4 For powder or liquid concentrates, sugar content will be calculated on the total volume of the prepared beverage.
Read the full update on the Health Promotion Levy on Sugary Beverages
Frequently asked questions
What is the Health Promotion Levy
The Health Promotion Levy (HPL) on sugary beverages is a new levy in support of the Department of Health’s deliverables to decrease diabetes, obesity and other related diseases in South Africa. HBL will be administered and collected by SARS.
When was it implemented
The Health Promotion Levy on sugary beverages was legislated through the Rates and Monetary Amounts and Amendment of Revenue Laws Act, 2017 – Act No. 14 of 2017 (see from page 46) as published in the Government Gazette on 14 December 2017, with effect from 1 April 2018.
How does HPL work
HPL on Sugary Beverages will be calculated as follows:
- The rate is fixed at 2.1 cent per gram of the sugar content that exceeds 4 grams per 100ml. The first 4 grams per 100ml are levy free;
- HPL will be paid in addition to any other Customs and Excise Duty payable and imports will not be declared on separate bills of entry;
- Sugar content means both the intrinsic and added sugar and other sweetening matter;
- Sugar content will be calculated on:
- The sugar content as certified on a recognised test report from a testing facility accredited with SANAS or ILAC;
- In the absence of such a valid test report, a deemed sugar content of 20 grams per 100 ml is assumed.
- For powder and liquid concentrates, sugar content will be calculated on the total volume of the prepared beverage.
Goods in respect of which HPL has been paid and that have been used for the manufacture of HPL goods or the manufacture of other goods by a licensee of such warehouse should complete the P.2.53 – Receipt of imported goods into the VM – External Form for refund purposes.
Which goods are subject to HPL
All goods as specified in the Schedule No. 1 Part 7, Section A manufactured in or imported into South Africa will be subject to the payment of HPL, specifically:
- Identified imported products will be taxed when it is cleared for home consumption and
- Locally manufactured products will be taxed at source.
Please note that HPL is a domestic consumption tax and is therefore not payable on sugary beverages that are exported or processed in the manufacture of other dutiable goods.
Who is it for
HPL on sugary beverages is payable by manufacturers thereof in the RSA.
What steps must I take
Relevant entities in the RSA must license with SARS Excise before they start to manufacture or otherwise deal in sugary beverages on which the applicable HPL has not yet been paid.
Do you need a Quote for our Tax and Accounting Services?
Contact our team via any of the following channels to get a proposal for your accounting and tax services:
Subscribe to our newsletters.
Disclaimer:
The views or opinions expressed on this site are solely those of the original authors and other contributors.
The material and information contained on this website is for general information purposes only.
This information is for general purposes only. Don't use this information for making business, legal and tax decisions without consulting a professional.
We do not make any express or implied representation, as to the completeness or accuracy of the information published.
Tax law changes regularly, and any tax information on this site might be outdated.
We are not responsible for any other websites that you may access through links on our website.
ZPA accepts no liability for any loss or damage arising from the use of any material on this site.
