An opportunity lost to address widespread malnutrition

Statement by Francois Baird, founder of the FairPlay movement

The government has once again refused to remove value added tax (VAT) from chicken portions. It is a shameful decision, because poor people will suffer, and malnourished children will suffer the most.

The government has repeated this error every year since 2018, when VAT was raised to 15% and FairPlay launched its campaign for “VAT-free chicken” – the removal of VAT from the chicken portions most consumed by low-income households. It has done so again in today’s budget, despite a sizeable revenue increase which could have funded the initiative.

Chicken is the main source of meat protein for poor families but, since 2018, they have had to pay an extra 15% on every portion of chicken purchased. Since 2018, the need for VAT-free chicken has become more urgent every year, as poverty and hunger spread.

A majority of South African households are food insecure, and 1.7 million more people are unemployed now than eight years ago.

While VAT-free chicken is a targeted intervention which would immediately lower the price of the chicken bought by poor families, the government has opted instead to relieve poverty through social grants.

This is an opportunity missed to address hunger, malnutrition and the high level of child stunting highlighted by President Cyril Ramaphosa earlier this month. Stunting results from chronic malnutrition and affects more than a quarter of South Africa’s children.

While grant money goes directly to poor families, it does not go directly to food. More specifically, it does not go directly to nutritious high-protein foods like chicken.

VAT-free chicken is a pro-poor initiative, because it targets the offal and frozen chicken products on which poor families rely for their meat protein. Wealthier families prefer fresh, value-added or deboned chicken, which would continue to be subject to VAT.

Grant money is general income, and will be spent on a variety of household needs and preferences. About 50% of it will go on food, but families also have to pay rent and for transport, clothing and other necessities. A portion may go on alcohol and airtime for mobile phones.

Debt repayment is an increasing burden for stressed families, and a new concern is the amount of money spent on online gambling.

Welcome as the grant funding is, it is nowhere near an answer for the hunger and malnutrition suffered by millions of South African families.

VAT-free chicken, including offal and frozen bone-in portions, would have cost R5.8 billion in lost revenue, according to a submission last year by the SA Poultry Association (SAPA). Zero-rating offal alone would result in lost revenue of R1 billion.

This is more than affordable, as has been pointed out by Charles de Wet of law firm ENS Africa, which compiled the submission. It is administratively simple, which grant funding is not.

Grants can take time to approve and implement, and there have been reports of fraud in government grant programmes. VAT-free chicken can be implemented immediately, and government and retail price surveys will monitor its effectiveness and prevent exploitation.

The combined cost of around R5.8 billion represents roughly 1.3% of net VAT collections last year, and approximately 0.3% of total tax revenue. And there are both immediate and longer-term benefits for the country.

Healthier families, and in particular healthier children, are a benefit in themselves. There are additional, long-term benefits for the country as a whole. A healthier workforce will earn more money, contributing to economic development in poor rural areas, and increasing tax revenue for the state.

Vat-free chicken is desperately needed. The government should reconsider its refusal to opt for this direct way to address hunger and malnourishment.

FairPlay will not give up. We will repeat these arguments, with vigour and backed up by facts, ahead of the medium-term budget later this year.

25 February 2026