The position of the Minster has not changed since the last oral reply. As indicated then, zero-rating of specific foodstuffs provides a larger proportional benefit to the poor (i.e. progressivity is enhanced). Overall, goods have a progressive impact and a strong equity-gain ratio – poor people consume a relatively high share of zero-rated items. Nevertheless, the analysis of the independent panel in 2018 indicated that extending zero-rating to further food items would be inefficient, since high-income households tend to benefit more from such measures.
We acknowledge the importance of the agricultural sector in tackling the issue of food insecurity which can both be addressed by increasing availability of food and affordability of food. National Treasury provides fiscal support to departments to support the agricultural sector. The fiscal support for agricultural sector is determined through the budget allocations to the Department of Agriculture, Land Reform and Rural Development, as articulated in the Estimate of National Expenditure (ENE) -Vote 29 and to provinces though the Division Revenue Act, and this information is available in various provincial budgets.
Consolidated spending allocations for agriculture and rural development, as presented in the 2023 Budget, are R27.8 billion in 2023/24, R28.6 billion in 2024/25 and R29.9 billion in 2025/26.