- FairPlay Movement founder Francois Baird says rising food prices mean poor South Africans who often turn to chicken as a cheap source of protein will no longer be able to afford it.
- South Africans pay VAT on frozen portions, chicken feet, gizzards and livers.
- Baird argues that low-income South Africans, particularly those in rural areas, shouldn’t have to pay VAT on products like whole chickens and mixed frozen portions.
For the past four years, trade group FairPlay Movement has been calling for value-added tax (VAT) on some chicken products to be scrapped, and now founder Francois Baird says this is more important than ever.
Baird, who founded FairPlay in 2016, says rising food prices mean poor South Africans - who often turn to chicken as a cheap source of protein - will increasingly be unable to afford it.
"The entire world is seeing food inflation, the only way to help poor people in South Africa is to lift VAT on some chicken portions, so that they can get access to protein," explains Baird.
In March 2022, the cost of the average household food basket grew by R94.39 to R4 450.09 from R4 355.70, according to the Pietermaritzburg Economic Justice & Dignity Group’s (PMBEJD’s) latest Household Affordability Index.
The index, which is focused on 44 food items, found that 22 of the items are subject to VAT. And chicken products - made up of frozen portions, chicken feet, gizzards and livers - are on the VAT list.
The increases come against the backdrop of the impact of Covid-19 and the ongoing war in Ukraine, leading to concerns are that food price increases are far from over.
To cushion the blow, Baird argues that low-income South Africans, particularly those in rural areas, shouldn’t have to pay VAT on products like whole chickens and mixed frozen portions. And that it is doable, since this would apply to certain products only.
For instance, FairPlay is not asking for a VAT lift for cooked chicken because it is consumed by people who are financially better off.
"So, we're trying to be to be very responsible and circumspect and to make it affordable ... [and] lift VAT on chicken," he says.
According to Baird, that it is something government can afford to do, since it is not a blanket removal of tax on all chicken products.
FairPlay’s sentiment is one shared by Association of Meat Importers and Exporters (AMIE), whose CEO Paul Matthew cited removing VAT on chicken as one of the solutions to easing consumer pressure.
But for Baird, ensuring that consumers have access to chicken is also rooted in ensuring that children have access to protein from a young age.
He adds that South Africa’s growth-stunting rate is at its highest in history, affecting 27% of children under the age of five.
Baird also adds that the movement is also looking at getting VAT on chicken feed lifted, since rising costs also affect consumers down the line.
Get the biggest business stories emailed to you every weekday.
Go to the Fin24 front page.