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The Beer Association of South Africa (BASA) expresses its disappointment with Finance Minister Enoch Godongwana’s announcement in today’s Budget Speech of a 6.75% increase in Excise Duties—a decision that will place further strain on an industry vital to South Africa’s economic growth and job creation.

BASA CEO Charlene Louw emphasizes the need for a more balanced tax approach: “The beer industry is a key driver of employment and economic activity. Increasing excise taxes beyond inflation—especially by 2% above CPI—hinders growth and job creation. Coupled with the 0.5% VAT increase, the financial burden on both businesses and consumers is even more severe.”

The beer industry’s contribution to South Africa’s economy is significant. In 2023 alone, it contributed:

• R96.46 billion to GDP
• R71.86 billion in tax revenue
• Supported 210,000 jobs

BASA Calls for a More Sustainable Excise Policy

To ensure long-term industry viability, BASA urges the government to:

• Align excise tax increases with headline CPI or CPI plus a one-percentage-point premium for predictability and stability.
• Introduce reduced excise rates for lower-alcohol beers (0.5%–3.5% ABV) to encourage responsible drinking and innovation.
• Address the growing excise tax burden, which has exceeded the government’s 23% target for six consecutive years—driving up costs and fueling illicit alcohol trade.

“A sustainable tax policy must consider economic realities, industry growth, and responsible alcohol consumption,” adds Louw. “BASA remains committed to engaging with National Treasury and stakeholders to develop a framework that balances revenue generation with industry stability.”

Issued by Beer Association of South Africa