OpinionPREMIUM

NOMCEBO DLAMINI | Treasury’s alcohol tax review: Confronting a legacy of harm

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Nomcebo Dlamini

Southern African Alcohol Policy Alliance SA is calling for increased excise tax on alcohol. A protest in Cape Town highlights the link between alcohol, GBV and poverty (Yoliswa Sobuwa )

As SA marks Youth Month and reaching the historic 50th anniversary of the 1976 youth uprisings, the country once again faces a defining moment in confronting one of the enduring legacies of apartheid: the destructive relationship between alcohol, inequality and social harm.

This time, however, the battleground is not the streets of Soweto. It is the National Treasury Alcohol Tax Review process.

The review, currently under way, may sound technical and distant from the general public.

Yet its implications for public health, community safety, youth wellbeing, and economic productivity are profound.

Crucially, this a rare policy window, one that emerges only once in roughly a decade.

South Africans cannot afford to sit this one out.

National Treasury opened the door for public participation through its discussion paper on alcohol taxation, with a technical workshop on June 4.

Falling within Youth Month, it should be understood not merely as a fiscal discussion but as part of SA’s continuing struggle to protect communities from structural harm.

Fifty years ago, young people resisted apartheid systems that used alcohol as a tool of social control and economic extraction.

Beer halls were not innocent recreational spaces. They functioned as instruments of apartheid governance, deliberately used to pacify black communities while generating municipal revenue.

The youth uprisings challenged these oppressive structures, including the social destruction associated with beer halls in townships.

Today, SA confronts a different but related reality.

Alcohol remains deeply embedded in patterns of violence, road deaths, gender-based violence, mental health crises, family breakdown and pressure on hospitals and emergency services.

Communities continue to carry the burden of cheap and easily accessible alcohol.

National Treasury acknowledges these concerns in its discussion paper.

Among the proposals under consideration are differentiated excise tax bands based on alcohol strength, alcohol content, and discussions around Minimum Unit Pricing (MUP).

These proposals deserve strong public support.

Globally, alcohol taxation is recognised as one of the World Health Organisation’s “Best Buys” for reducing alcohol-related harm.

The WHO Safer initiative specifically identifies raising prices through excise taxes as one of the most effective interventions available to governments.

Evidence from countries implementing stronger alcohol pricing policies consistently shows reductions in harmful drinking, violence, road injuries and pressure on healthcare systems.

Importantly, Treasury’s proposal to introduce differentiated beer tax bands based on alcohol strength is a major step forward.

It signals a shift away from treating all alcoholic beverages equally, regardless of their alcohol concentration and associated harm.

By incentivising lower-alcohol products, Treasury is beginning to align fiscal policy with public health outcomes.

But the proposals could go further.

The approach advanced by the Research Unit on the Economics of Excisable Products (Reep) offers a more ambitious and evidence-driven framework.

Reep has consistently argued for alcohol taxation systems that more directly target harmful consumption patterns, strengthen health outcomes and better reflect the true social cost of alcohol harm.

In particular, Treasury should seriously consider tightening the proposed beer bands.

The current proposal groups beverages between 2.5% and 9% alcohol content into a single category. This is too broad.

A narrower upper threshold, closer to 6%, would create stronger incentives for manufacturers to reformulate products towards lower alcohol content, while discouraging high-strength beer consumption patterns that contribute significantly to binge drinking.

This matters because beer remains the most consumed alcohol product in SA.

Critics will undoubtedly argue that higher taxes will fuel illicit trade or threaten jobs.

Yet evidence increasingly shows that effective enforcement measures against illicit trade can coexist with strong public health taxation policies.

SA does not need to choose between protecting public health and tackling illicit trade; it must do both simultaneously.

Nor should South Africans be persuaded that alcohol taxation is simply about state revenue collection.

This process is fundamentally about reducing the true cost of alcohol harm borne daily by women, children, healthcare workers, schools, police officers and communities.

The struggle today may not involve physically bringing down beer halls. It may involve supporting proven fiscal policies that reduce harmful drinking, incentivise safer products and place public health above commercial interests.

Policy reform rarely captures the national imagination. But this one should, because SA may not get another opportunity like this for another decade.

Nomcebo Dlamini, campaign director: Southern African Alcohol Policy Alliance

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