Tapiwanashe Mangwiro
FOLLOWING the successful collection of US$24 million by Treasury from the beverages sector through the sugar tax, a call has been made to expand “sin taxes” to include many products that affect people’s health.
Sin taxes are levies imposed on goods considered harmful to public health and societal well-being. The taxes, which already include the sugar tax introduced this year, are considered vital in bolstering health services.
They are also seen as discouraging the consumption of unhealthy products that have serious ramifications on the health of the populace, including the critical labour force in all sectors of the economy.
Addressing parliamentarians at the 2025 Pre-Budget Seminar in Bulawayo recently, Minister of Finance, Economic Development and Investment Promotion Professor Mthuli Ncube highlighted the tangible benefits of the sugar tax.
“All resources mobilised from the tax are ring-fenced towards therapy and procurement of cancer equipment for diagnosis,” said Minister Ncube, who is expected to present the 2025 National Budget before the end of the month.
From January 2024 to September 2024 alone, the Government raised US$24 million, which is now being used to procure cancer diagnostic machines and essential medicines. Given this outcome, experts argue that expanding sin taxes could provide the much-needed boost to Zimbabwe’s overstretched healthcare system.
The World Health Organisation says non-communicable diseases, including heart disease, stroke, cancer, diabetes and chronic lung disease, account for 74 percent of all global deaths. The organisation has called for urgent measures to protect people from harmful products.
Reports say, while these lifestyle diseases have traditionally affected elderly populations, it seems young people are now equally vulnerable, presenting a huge financial burden to national health systems.
Dr Prince Takuva, a public health specialist, applauded the sugar tax initiative and called for its extension to other harmful products.
“Non-communicable diseases like diabetes, hypertension and cancer are on the rise, and they impose a massive burden on our healthcare system,” Dr Takuva explained.
“By increasing taxes on harmful products such as tobacco, alcohol and sugary snacks, we can both deter harmful consumption and generate revenue for critical health services.”
Dr Takuva emphasised that preventive measures are more cost-effective than treating advanced illnesses.
“It’s a win-win situation. Reduced consumption means fewer people getting sick, and the revenue generated ensures our hospitals and clinics are better equipped,” he added.
Economist Ms Gladys Shumbambiri-Mutsopotsi supported the proposal, emphasising the fiscal benefits.
“Sin taxes are not punitive; they are corrective,” she said.
“They serve to internalise the societal costs of harmful products, ensuring those who consume them contribute to the public health challenges they exacerbate.”
Ms Shumbambiri-Mutsopotsi cited global cases, including South Africa’s alcohol and tobacco taxes, which have successfully raised revenue and curbed excessive consumption of these products.
“Zimbabwe can expand this approach to include items like ultra-processed foods and energy drinks, which are increasingly linked to public health challenges,” she argued.
However, Mr Tinevimbo Shava, a business analyst, cautioned against overburdening local manufacturers.
“While sin taxes are vital, we must consider their impact on businesses, especially in an economy already facing significant challenges,” Mr Shava noted.
The beverage sector, which faced an initial tax of US$0,02 per gramme of sugar before it was reduced to US$0,001 following an outcry by industry, is a case in point.
“We need to ensure these measures do not stifle innovation or lead to job losses,” Mr Shava warned.
He proposed offsetting the impact of sin taxes with targeted tax relief measures.
“Reducing VAT (value-added tax) on essential raw materials or offering tax holidays for companies investing in healthier product lines could ease the burden on
manufacturers, while encouraging them to align with public health goals,” Mr Shava added.
The success of the sugar tax highlights the potential of sin taxes to address critical funding gaps in healthcare.
However, as the Government is encouraged to expand this model, a balanced approach is essential to ensure both public health and economic stability are prioritised.
Responding to the proposal by parliamentarians with regard to sin tax on alcohol, Minister Ncube said there is need for a cautious approach in advocating additional taxes, cognisant of the need to maintain production levels.
He said alcoholic beverages, wines and spirits attract customs duty ranging from 25 percent to 100 percent, coupled with excise duty of a minimum US$0,25 per litre.
Introduction of an additional tax may undermine production activities, said Minister Ncube.
