The National Treasury has issued a call to the public, inviting written submissions regarding the taxation of alcoholic beverages, with a deadline set for 13 December 2024. This initiative aims to tackle South Africa’s escalating alcohol consumption crisis, as the country battles the ramifications of high alcohol use, which ranks fifth on the World Health Organisation’s (WHO) list of nations with heavy drinkers.
According to WHO statistics, alcohol is responsible for over 5.3% of global deaths annually, linking it to more than 200 diseases and injuries. South Africa, being a charter member of the United Nations, holds a responsibility to uphold WHO recommendations aimed at addressing alcohol misuse and raising awareness about its detrimental health effects.
A statement from the National Treasury outlined the focus of the upcoming consultations: “The discussion document covers developments in the alcoholic beverages industry, including changes in the regulatory landscape, the prevalence of alcohol consumption, illicit trade in alcohol beverages, and international observations on alcohol taxation.” It suggests that potential long-term strategies may include implementing minimum unit pricing, alongside other considerations raised by stakeholders.
The Treasury’s decision to engage the public on this issue comes as various civic groups argue that increasing alcohol prices could lead to a reduction in consumption. However, concerns from members of the liquor industry have emerged, claiming that the consultation period is too brief. Critics warn that an increase in taxes could hinder existing businesses, lead to job losses, and negatively impact the revenue streams of alcohol outlets.
Once the consultation period concludes, the feedback gathered will inform revisions to the draft proposals, which will be presented in the 2025 budget. This process highlights the delicate balance that policymakers must strike between public health objectives and the economic realities faced by a significant sector of the economy.
