South Africans will soon find themselves reaching deeper into their pockets to enjoy their preffered alcoholic beverages and tobacco products, as the government unveils plans to escalate excise duties on these commodities at a rate surpassing projected inflation for the 2025/26 financial year.
Per the 2025 National Treasury Budget Review document, a robust 6.75% hike in excise duties is proposed for alcoholic beverages.
Concurrently, tobacco products will face a 4.75% increase for cigarettes, cigarette tobacco, and electronic nicotine and non-nicotine delivery systems (widely known as “vaping”), while pipe tobacco and cigars are slated for a more substantial 6.75% adjustment.
The National Treasury elucidated, “To ease the administrative burden of implementing adjustments on Budget Day, in future years, adjustments to excise duties will take effect from 1 April. Legislative provisions to deal with unusual clearances of cigarettes around Budget announcements have been in place since 2021 and may be extended,” signaling a strategic shift to streamline fiscal operations.
Last November, the government issued a thought-provoking discussion paper, The Taxation of Alcoholic Beverages, inviting public commentary.
“It proposes adjustments to the alcohol excise taxation policy framework, including the introduction of a three-tier progressive excise duty rate structure for wine and beer. Government will hold public consultations on the new excise framework during 2025. Considering that the details of the new alcohol excise taxation framework will be finalised only after the 2025 Budget, government has proposed to increase excise duties on alcoholic beverages by 6.75% for 2025/26,”stated National Treasury.
The forthcoming excise duty revisions for the 2025/26 financial year are delineated as follows:
· Unfortified wine, currently levied at R5.57 per litre, is poised to rise to R5.95 per litre.
· Fortified wine, now at R9.40 per litre, will ascend to R10.04 per litre.
· Sparkling wine, presently taxed at R17.83 per litre, is set to increase to R19.03 per litre.
· Ciders and alcoholic fruit beverages, currently at R135.89 per litre of absolute alcohol (translating to 231.02c per average 340ml can), will climb to R145.07 per litre of absolute alcohol (246.61c per average 340ml can).
· Spirits, taxed at R274.39 per litre of absolute alcohol (R88.49 per 750ml bottle), are projected to reach R292.91 per litre of absolute alcohol (R94.46 per 750ml bottle).
· Cigarettes, currently priced at R21.77 per pack of 20, will see a rise to R22.81 per pack.
· Cigarette tobacco, presently at R24.47 per 50g, is anticipated to increase to R25.63 per 50g.
As the prices of alcohol and tobacco prepare to surge, these fiscal adjustments promise to reshape consumer habits and spark spirited debate. What are your reflections on this evolving landscape?
We encourage you to share your insights in the comment section below.
2 Responses
You write an article on sin tax, yet make no mention of the VAT increase, fuel levy increase, annual salary increase affecting tax bracket. What is more important, sin tax or the fact that consumers are now going to have to fork out more on living expenses. You need to prioritize your articles. Advertiser has become a joke when it comes to writing articles on what is actually happening in the real world
Good day. The article focuses on the government’s latest announcement regarding sin tax. This was not an article discussing the entire scope of increases facing the country. As a leading news agency, Newcastillian News prioritise all articles, thus why discussing yet another set increases announced by the government was brought to the public’s attention. We will, however, put together an article detailing all increases hitting the country, to give readers a snapshot of the current reality.