South African Informal Traders Alliance says merchants’ profits squeezed by price hikes for fuel, electricity, food

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DURBAN – AS THE Minister of Finance delivered his Medium-Term Budget Policy Statement this afternoon, the South African Informal Traders Alliance (Saita) called for the plight of traders to be acknowledged.

The alliance said increases in administered prices and excise taxes all have a direct impact on the price and affordability of products which are sold by informal traders. These include fruit and vegetables, dairy and tobacco products.

According to the national president of Saita, Rosheda Muller, informal traders had been hit hard by the pandemic.

“With movement and gathering restrictions, lockdowns and a lack of financial support from government, informal traders have been disproportionately impacted by the pandemic over the past 19 months. Exacerbating this are the never-ending increases to the price of petrol, paraffin, water and electricity and gravely concerning, the price of food,” said Muller.

The common products sold by traders are fruit and vegetables, cigarettes and other tobacco products, dairy products, chips, sweets and cold drinks.

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Muller said with the profit margins of informal traders being so low, increases in the costs of inputs such as petrol, or an increase in taxes on tobacco, had a major impact on the traders’ ability to stay relevant, and in business.

“This is especially true for tobacco products. Illicit trade has exploded since the beginning of the pandemic, most likely due to the ban on tobacco sales. This has had a significant impact on crime, the health of our citizens and our ability to compete with these criminals on a level playing field. We are committed to fighting illicit trade, but extraordinary increases in cigarette taxes will simply drive customers to trade down into cheaper illicit brands,” Muller said.

“Millions of South Africans work in the informal trade in order to feed their families and educate their children but our voice is seldom heard, and our needs seldom taken into account when it comes to government’s policies and budgets.”

THE MERCURY