Finance Minister Enoch Godongwana just delivered his first budget speech and was the bearer of bad news for the alcohol and tobacco industry.
All tobacco prices to see an increase
The minister confirmed that the government was planning on increasing excise duties on alcohol and tobacco by between 4.5% and 6.5% for both 2022 and 2023. And while the increases are implemented today already, it is still lower than last year’s 8% increase.
“The targeted excise burden for wine a 750 bottle of wine will be 17c more expensive, a 340 can of beer or cider be 11c more, a bottle of sparkling wine will cost an additional 76c, a bottle of spirits will be R4.83 more expensive,” Godongwana said.
- Cigaretts will increse with R1.03
- Piped tobacco 25g will increase with 37c
- A 23g cigar will increase with R6.77
The minister added that the current excise duty regime applies a flat rate for traditional African beer powder of R34.70 per kg. And for similar products in the market, the Treasury decided:
“In the interest of equity, these products will be included in the tax net with an excise equivalent to the powder rate from 1 October 2022,” he said.
And lastly, the government is also proposing to introduce a new tax on vaping products from the 1st of January 2023 – R2.90 per millilitre.
Sugar tax also received an increase
During the budget speech, Godongwana also revealed that, from 1 April 2021, any beverages with more than 4g of sugar content per 100 ml will rise by 2.21c/g to 2.31c/g.