Govt taps sin taxes to plug funding gaps in health 

Source: Govt taps sin taxes to plug funding gaps in health | The Sunday Mail

Debra Matabvu

THE Government is getting “a decent amount of resources” from sin taxes and is unlikely to have a supplementary budget to plug funding gaps in the health sector — particularly HIV/AIDS programmes — following the withdrawal of United States aid support.

Currently, at least three taxes are being channelled towards the health sector.

They include a sugar tax introduced in 2023. The sugar content tax, initially pegged at US$0,02 per gramme of sugar in locally manufactured beverages, was reduced to US$0,001 per gramme in the 2025 National Budget.

Additionally, a 1 percent tax on fast-food items, such as pizza, burgers and chips, was introduced in 2025.

This levy serves the dual purpose of discouraging unhealthy eating habits and boosting revenue for the health sector.There is also a tax on alcohol and cigarettes, introduced under the National Alcohol Policy in 2010, whose proceeds are directed towards healthcare.

In an interview with The Sunday Mail, Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube said these taxes were generating substantial revenue that could help sustain HIV/AIDS programmes and broader health sector needs.

The Government, he said, was closely monitoring the situation following the withdrawal of support by organisations such as the United States Agency for International Development (USAID).

“Well, in terms of our assessment, we do not think a supplementary budget is necessary at this stage, but we will keep assessing,” said Prof Ncube.

“The reason I say that is because Parliament has worked with us, the Treasury, to raise additional revenue from other taxes.

“For instance, we have got the sugar content tax, which we know is targeted at the health sector.

“We also have various sin taxes around alcohol and cigarettes that are also targeting the health sector.

“We also have the tax on fast foods, specific fast foods, that is also targeting the health sector.

“So, we feel that from those taxes, we should be able to raise a decent amount of resources. There won’t be any need for a supplementary budget.”