‘If this levy goes ahead, chances are high that South Africans will cover the cost through higher subscription fees.’
The Broadcasting Act of 1999 stipulated that South Africans must possess TV licences to own a television. This licence is valid for one year and is payable in advance before the beginning of the license year.
However, since then, the TV licence system has seen people opting not to pay it, choosing to pay for other streaming platforms such as Netflix, Dstv, and Showmax. Meanwhile, some South Africans cannot afford a TV licence due to the high cost of living.
This has partly impacted operations at the South African Broadcasting Corporation (SABC), as the costs of chasing payments outweigh the revenue collected.
What is a streaming levy?
Minister of Communications and Digital Technologies, Solly Malatsi, announced he was considering introducing a ‘streaming levy’ on streaming services as a funding option for the SABC.
He cited the current TV licence model as inadequate due to “low compliance, high collection costs and the eroding effects of inflation”.
Leslie Adams, sales director at Reach Africa, said the SABC still matters to the millions of South Africans who cannot afford to pay for premium services.
“Yet forcing streaming platforms to foot the bill isn’t as simple as it sounds.”
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Who is going to pay the streaming levy?
Should the streaming levy be implemented, who is going to pay? Consumers or the streaming platforms?
Adams added that in some countries, streaming services absorb levies as part of their operating costs, which is unlikely in SA.
“We have seen Netflix, Amazon, and Disney+ increase prices multiple times in recent years.
“If this levy goes ahead, chances are high that South Africans will cover the cost through higher subscription fees. And with the economy under pressure, that’s not great news.”
Many South Africans are already cutting back on entertainment spending.
If prices rise again, people might turn to illegal streaming, free ad-supported content, or even ditch paid services.
Could this hurt the film and TV industry?
He said beyond funding the SABC, there is a bigger conversation to be had about how global platforms support local content.
“Over the years, Netflix, Amazon and Showmax have invested heavily in local productions, giving our stories a global audience.
“But that investment is starting to slow down. Some platforms are becoming more selective with local content, and Amazon has already reduced its spending in Africa.”
He stresses that content churn is set to accelerate as streamers shift focus from subscriber growth to profitability.
What could happen if the levy is implemented?
Adams added that if the government forces streaming platforms to pay a levy, streamers may further reduce their local investments.
However, if the levy is structured properly, the money raised could go to funding local productions, creating jobs, and supporting the industry — but it would need to be done correctly if this is the key.
“If there’s no transparency in how these funds are used, we could end up with another tax that disappears into the system without benefiting South African creatives and content producers.”
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Could streaming platforms exit South Africa?
Would a streaming levy see popular platforms like Netflix, Amazon or Disney+ leave the country? Probably not, but this might put a burden on already burdened consumers.
He said South Africa is still a valuable market for streaming services, and global platforms have dealt with tougher regulations elsewhere.
However, these platforms could scale back their operations, reduce local content investments, or bundle the costs to make streaming less affordable for South Africans.
It is also worth noting that streaming services already face high costs here.
“Bandwidth is not cheap, and many platforms partner with telecom providers to manage data costs. Adding another tax could make things even more complicated.”
What would a fair and sustainable levy look like?
Adams added that for this levy to work, it must support both the public broadcaster and the local content industry – without making streaming unaffordable.
“Funds should be reinvested in local films and TV shows, not absorbed into government budgets.
“The levy must also be reasonable. If too high, streaming platforms will pass the cost onto consumers or cut local investments, hurting viewers and the industry.”
Different streaming models must also be considered –— a flat tax will not work for platforms that operate differently.
“Additionally, private broadcasters like MultiChoice and eMedia could contribute: a local content levy for these broadcasters would ensure that funding responsibility is shared more equitably, rather than placing the entire burden on global streaming platforms.
“Finally, the SABC must prove it can manage funds responsibly. Before imposing a new tax, the government must fix inefficiencies and ensure transparency so this revenue benefits South African content producers.”
A levy could work — but only if handled carefully
Adams added that South Africa is not the first country to try taxing global streaming services.
Some places have made it work, while others have seen unintended consequences – higher prices, less local investment and frustrated consumers.
“If done right, a streaming levy could strengthen South African content creation and help sustain the SABC.
“But if it’s rushed or mismanaged, it could drive up prices, push people toward piracy and hurt local content investment.
“The government needs to engage with all stakeholders – streaming services, content creators and consumers – to find a fair, effective solution that benefits the entire entertainment ecosystem.”
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