Biodiversity Tax Incentives For South Africa's Protected Area Network

Candice Stevens
Published: 16 August 2018
Last edited: 02 October 2020
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South Africa identified protected area expansion as a key tool to ensuring the persistence of its biodiversity and ecosystems essential for its people and economy. Approximately 75% of South Africa is held in private ownership. Landowners bear the responsibility of managing protected areas and face financial commitments as a result. The Fiscal Benefits Project was launched to test biodiversity tax incentives as a financial benefit for landowners declaring protected areas. This began with the introduction of a new tax incentive into legislation. The impact of the incentive was tested at pilot sites across the country, resulting in the successful inclusion of the tax break in a tax return. This has paved the way for other privately owned protected areas to receive financial recognition and ensure the continued governance and management of South Africa’s protected areas, utilising building blocks of policy and grassroots engagement, niche expertise and a supportive community of practice.


East and South Africa
Scale of implementation
Freshwater ecosystems
Grassland ecosystems
Marine and coastal ecosystems
Rangeland / Pasture
River, stream
Temperate grassland, savanna, shrubland
Wetland (swamp, marsh, peatland)
Biodiversity mainstreaming
Ecosystem services
Legal & policy frameworks
Local actors
Protected and conserved areas governance
Protected and conserved areas management planning
Sustainable financing
Land and Forest degradation
Loss of Biodiversity
Ecosystem loss
Lack of access to long-term funding
Changes in socio-cultural context
Poor monitoring and enforcement
Sustainable development goals
SDG 6 – Clean water and sanitation
SDG 8 – Decent work and economic growth
SDG 15 – Life on land
Aichi targets
Target 3: Incentives reformed
Target 5: Habitat loss halved or reduced
Target 11: Protected and conserved areas
Target 14: Ecosystem services
Target 20: Mobilizing resources from all sources


South Africa


South Africa’s first biodiversity tax incentive provides financial sustainability for privately and communally owned protected areas, allowing for the continued and often costly governance and effective management of important sites. By providing financial sustainability that is linked to protected area management, the challenge of poorly managed protected areas ineffectively stopping habitat and biodiversity loss is addressed. Better management also supports the health and provision of ecosystem services. Landowners and businesses benefit economically and socially as tax breaks reduce the amount of tax owed, freeing up much needed cash flow, in turn ensuring continued commercial viability of activities compatible with protected areas, such as eco-tourism and cattle ranching. Effective and sustained protected areas also support sustainable livelihoods, development of the rural economy, and ensure the long term persistence of protected areas in landscapes competing for resources.


Beneficiaries of the biodiversity tax incentives include private and communal landowners willing to declare and manage protected areas, these range from individual farmers to multiple stakeholder communities to corporates and parastatals.

How do the building blocks interact?

Successfully introducing South Africa’s first biodiversity tax incentive was a complex process requiring support from numerous stakeholders, including government, protected area implementers, landowners and communities. The process also required concrete testing to determine the impact of the incentives and their tangible benefit on the ground. Due to the nature of the finance solution being tax related, niche tax skills were required to implement the solution, at a policy level, and during grassroots testing. These needs and processes illustrate how the solution’s four building blocks: national policy engagement, grassroots engagement, a cohesive community of practice, and niche tax skills, worked together to achieve this unique success. The policy engagement enacted a legislative amendment that introduced the new tax incentive, which could then be tested with landowners and communities at a grassroots level to determine its effectiveness. This testing would not have been possible without the involvement of a collaborative community of practice. These engagements required a tax specialist due to the nature of the niche expertise required for implementation, which combined with the other building blocks, created a winning formula.


South Africa’s first biodiversity tax incentive provides financial sustainability for privately/communally owned protected areas allowing for the continued governance and effective management of important sites which require continual and often costly management. The project benefits landowners and businesses economically and socially by providing tax breaks that reduce the amount of tax owed. Freeing up much needed cash flow, ensuring continued commercial viability for activities compatible with protected areas, such as eco-tourism and cattle ranching. The use of biodiversity tax incentives in protected areas is recognised as one of the UNDP’s BIOFIN Solutions for South Africa. It is estimated to contribute close to 10% additional finance in closing South Africa’s biodiversity finance gap. Despite protected areas featuring as a key conservation tool by the South African Government, there are limited resources and capacity in the public and private sectors where conservation funding remains an urgent priority. The inclusion of a successful tax break into South Africa’s protected area network is providing much needed biodiversity finance for the sustainable persistence of well governed and effectively managed protected areas.


Kaingo Private Game Reserve

South Africa is recognised as one of the world’s 17 mega-diverse countries. Protected areas, declared on state, private or communal land are key to safeguarding South Africa’s incredible biodiversity and the functioning of ecological infrastructure essential to the benefit of its people and its developing economy.


Expanding, governing and managing protected areas is a costly undertaking and limited resources and capacity, as well as other socio-economic constraints, hinder these processes. South Africa’s privately and communally owned protected areas play a vital role in addressing some of these challenges. However, landowners willing to make the ultimate conservation commitment, in formally recognising and managing protected areas on their land, require assistance either through conservation services and relationships or financial benefits, such as South Africa’s first biodiversity tax incentive: Section 37D.


In one of South Africa’s Key Biodiversity Areas, full of endemic plants, Big Five game, and scenic diversity, one such landowner took the plunge and declared a Nature Reserve in perpetuity. Kaingo Private Game Reserve is an effectively managed protected area and a successful tourism operation, creating jobs and stimulating the rural economy of the area. The creation and management of this beautiful reserve and its eco-tourism operations is no small feat.


As a result of this landowner’s commitment to conservation, Kaingo has received the Section 37D tax break. Due to the extensive investment in the tourism venture and the management of a big game area, the tangible financial benefit of this innovative tax incentive is bolstering the reserve’s cash flow, ensuring the continued success of this protected area. By paying less tax, additional resources can be mobilized so that Kaingo can be better managed and governed and continue to grow, benefiting both South Africa’s biodiversity and its economy. Without effective management protected areas fail to achieve what they were created for, and without viable and sustainable business operations to support management costs, such as Kaingo, effective management is no longer feasible.


It is a priority to provide valuable and alternative sources for financing biodiversity conservation, and rewarding individuals and organisations willing to undertake the safeguarding of our natural heritage, if we are to see the continued persistence of wildlife and beautiful landscapes in South Africa.

Contributed by

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Candice Stevens Wilderness Foundation Africa, South African National Biodiversity Institute, United Nations Development Programme (UNDP), Department of Environmental Affairs, BirdLife South Africa

Other contributors

Wilderness Foundation Africa and BirdLife South Africa