South African government proposes drastic excise tax increases on wine

Published 2024년 11월 27일

Tridge summary

The South African government has unveiled a policy review with plans to boost alcohol excise tax in the 2025 Budget, potentially increasing rates by up to 80% in an effort to curb alcohol misuse. This proposal has sparked backlash from South Africa Wine, the national body representing the wine industry, which warns of severe threats to the sector's sustainability and socio-economic benefits, arguing that the move could lead to job losses and financial strain for producers. The organization also emphasizes that high excise rates could drive more people towards the illicit alcohol market, which already makes up over 22% of South Africa's alcohol consumption. They have called for a extension of the deadline for stakeholder comments and a reconsideration of the proposed increases, advocating for enhanced oversight and enforcement against illicit trade as a more effective approach to addressing public health and revenue goals.

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Original content

The government of South Africa has published a policy review on the taxation of alcoholic beverages, with plans to increase excise tax in the forthcoming 2025 Budget. Containing a number of significant policy changes and amendments to the regulatory landscape, the document outlines plans to raise tax rates by up to 80%, partly to “reduce the harmful use of alcohol”. South Africa Wine, the national body representing the country’s wine grape producers and industry stakeholders, has nonetheless condemned the proposal, stating that it “poses a severe threat to the sustainability of the wine sector and its significant socio-economic contributions”. According to Rico Basson, CEO of South Africa Wine: “These proposals could devastate our industry, driving job losses and forcing producers out of the market.” “He added: “The Budget, contributes R56bn to the economy, and plays a vital role in rural development. The proposed excessive increases in excise rates will destabilise this critical ...

Source: Harpers