New alcohol tax on the cards for South Africa

South Africa is currently facing proposed alcohol tax changes, including higher taxes on stronger drinks and minimum pricing for cheap alcohol, which are aimed at curbing alcohol-related social harms in the country.

The South African Alcohol Policy Alliance (SAAPA) is urging the public to participate in discussions around proposed changes to alcohol taxation.

The organisation argues that stronger measures are needed to tackle the country’s severe alcohol-related social harms.

The National Treasury is currently reviewing aspects of South Africa’s alcohol taxation framework, including a proposed tiered tax system and minimum unit pricing.

The proposed tiered tax structure would place higher taxes on stronger alcoholic beverages, while minimum unit pricing would introduce a floor price to prevent extremely cheap alcohol from being sold.

Speaking to Newzroom Afrika, SAAPA campaign director Nomcebo Dlamini explained that the proposals are specifically aimed at reducing harmful drinking behaviour.

This particularly relates to binge drinking, which is linked to cheap, high-alcohol-content products.

“The taxing tiers system is aimed at encouraging manufacturers to start to manufacture lower alcohol content beers in particular,” she said.

Beer remains the most consumed alcoholic beverage in South Africa and is closely associated with binge drinking, particularly among younger consumers.

“That’s the drink that a lot of South Africans are binge drinking, and it’s the drink that a lot of even our young people, who are underage in some instances, are drinking,” Dlamini said.

She said cheap alcohol contributes directly to harmful consumption patterns, especially in poorer and rural communities. “In rural communities, you find these drinks that are 750 millilitres.”

“You find young people carrying these bottles and walking around with them, and it’s because they are cheap and people can buy them, especially those who are economically disadvantaged.”

According to Dlamini, Treasury’s goal is to encourage producers to reduce alcohol content while also ensuring products cannot be sold at extremely low prices relative to their alcohol strength.

“The minimum unit pricing will ensure that, should there be a drink that is a certain size, it does not have a high level of ethanol in it.”

South Africa’s big drinking problem

Dlamini explained that South Africa’s drinking patterns remain deeply concerning, with binge drinking, alcohol-related violence and health complications placing enormous pressure on communities and public services.

“It is indeed a sobering matter because in South Africa, about a third of South Africans drink alcohol, and of those that drink alcohol, 50% of them binge drink,” Dlamini said.

“It’s not just drinking alcohol, it’s drinking alcohol in a harmful manner. We are unfortunately one of the countries that rank high in terms of binge drinking.”

She added that South Africa also leads the world in fetal alcohol spectrum disorder (FASD), a condition caused by alcohol exposure during pregnancy.

“When you talk of children, for instance, this is Child Month that we are commemorating, a child that is born with FASD cannot have a great future,” she said.

“The challenges that come with that child having been born in that way are challenges that the health system will have to deal with, the education system will have to deal with, and families and communities will have to deal with.”

According to Dlamini, the widespread availability of alcohol has also worsened harmful drinking patterns across the country, including in rural communities.

“We also have a high proliferation of taverns in our country, and this is not normal because it’s also now gone into rural areas,” she said.

“We are seeing binge drinking infiltrating even rural South Africa, and the rates of gender-based violence that are enabled by alcohol.”

While she stressed that alcohol itself does not directly cause crime or violence, she argued that it contributes significantly to many of South Africa’s social problems.

“One thing is true,” Dlamini said. “It enables almost every social ill that you can think of in our country.”

Concerns over cheap alcohol and illicit trade

The proposals have not been received well by everyone. Critics have argued that increasing prices on cheaper alcohol could disproportionately affect lower-income consumers, including those who drink responsibly.

Dlamini acknowledged concerns around the illicit alcohol trade but said evidence does not support claims that higher taxes would automatically drive widespread illegal consumption. “The issue of illicit alcohol is very real, and we’re not denying it.”

“But the levels of illicit alcohol availability in our country, those are the numbers that are often peddled, are the ones that we are not agreeing with because there’s actually no research that proves this.”

She added that the South African Revenue Service’s (SARS) track-and-trace system for alcohol products should help address concerns about illegal trade.

“What we are thankful for is that SARS has now initiated a track and trace system to deal with that problem of illicit trade as well as illicit products in the market.”

Dlamini argued that, in South Africa, the bigger issue remains the widespread availability of legal alcohol products.

“The big trucks that are getting into our communities are those of the licit alcohol. Those are the ones being consumed at extremely high rates, and those are the ones that you find at all these taverns that are around every corner.”

SAAPA also believes that international examples show that stricter alcohol policies can work.

Dlamini pointed to Lithuania as one of the strongest examples of successful alcohol reform. “Lithuania is a shining example,” she said.

“They have not just implemented the tax fiscal policies, but they’ve also brought in a ban on marketing. They have also ensured that licensing is enforced, and they have really done exceptionally well on this.”

Dlamini also cited Scotland’s implementation of minimum unit pricing and Russia’s efforts to reduce spirit consumption.

Broader reforms needed

Beyond taxation, Dlamini said South Africa also needs broader reforms, including tighter controls on alcohol advertising and licensing.

“The Department of Health and the Department of Social Development need to be pushing in their mandate,” she said.

“The Department of Trade, Industry and Competition also has to be pushing in its own mandate, which is around the issue of advertising and marketing.”

She welcomed the tabling of a private members’ bill to ban alcohol advertising, but said the Liquor Amendment Bill of 2016 should also be revived.

“That covers it all. It covers the issue of marketing. It covers the issue of where exactly a person can have a liquor establishment, especially in our townships.”

“Right now, we find liquor establishments across a church. We find them near a primary school.”

Dlamini stressed that taxation alone would not solve the problem but said it remains an important part of a broader strategy. “Taxation is not a silver bullet, but it does need all the other departments to come on board.”

National Treasury will host a virtual technical workshop on 4 June 2026 to discuss the proposals, with members of the public encouraged to participate.

Dlamini urged South Africans to engage before the deadline to request oral submissions closes. “If we do not talk now, we are probably going to have another 10 years before we’re given an opportunity like this.”