Business Maverick


Traditional African beer spared the usual sin tax hike, E-cigarettes still tax free

Traditional African beer spared the usual sin tax hike, E-cigarettes still tax free

The ruling African National Congress still has its eye firmly on the rural and township vote, providing tax relief to consumers of traditional African beer.

If you are a fan of traditional African beer, Finance Minister Tito Mboweni has given you a reason to raise a glass. 

While sin taxes have been once again been raised – this happens every time the planet completes its orbit around the sun at this time of the year – traditional African beer, and traditional African beer powder, have been excluded from a hike. According to the Treasury, accounting for inflation, this means that the real tax rate on such products will decline 4.4% from the start of April. 

Malt beer, wine and spirits will see tax spikes of 4.4% and if you have a bourgeois fondness for sparkling wine, your consumption will contribute 6% more to the Treasury in the next fiscal year.

There does appear to be some sort of class bias at work here, a sort of progressive tax by sleight of hand. Patrons of the Saxonwold Shebeen will feel the pinch more than patrons of a shebeen in the old Transkei, for example.

This can also be seen with tobacco tax policy. Regular smokers will pay 4.4% more in taxes, while pipe and cigar smokers will fork out 7.5% more. But electronic cigarettes remain untaxed, though the government intends to start taxing such products from 2021. BM


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