Beer Bottling plant. Málaga, Spain
Beer bottling plant. (Getty)

  • Beer-maker SAB is urging finance minister Tito Mboweni to not increase taxes on alcohol, as the industry continues to reel as a result of liquor bans imposed during the country's lockdown.
  • The alcohol industry has lost over R30 billion throughout the bans, according to SAB.
  • Increasing the beer taxes would impede on the recovery of farmers supplying the alcohol industry, SAB says.
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SAB has one request for government ahead of finance minister Tito Mboweni’s budget speech: please do not increase taxes on alcohol.

Mboweni is due to deliver his Budget speech on 24 February, amid South Africa’s growing debt crisis and revenue that has been lost due to the economic fallout caused by the coronavirus pandemic.

In a video post on its Twitter account, SAB appeals to Mboweni to "please tax beer responsibly". It also highlights the potential impacts of a tax hike on farmers supplying the alcohol industry, adding that the beer giant buys from more than 1,000 farmers locally -  the majority of whom are emerging black female farmers. 

In a separate post, SAB says stabilising the beer value chain after the third alcohol ban remains challenging, adding that “any excise tax increase will affect the sustainability of the industry and economy.”

READ: SA’s booze ban is costing glassmakers R8 million a day, but they can’t turn off the furnaces

The tweets are also in response to Mboweni's request that the public submit tips for his Budget speech later this month. Last month Mboweni invited the public to offer their #TipsForMoF.

The alcohol industry has contended with three alcohol bans - lasting over four months cumulatively - since the start of the lockdown and has lost billions as a result.

See also: SA now has 300 million litres of unsold wine - here's how it will probably play out

SAB has said the the industry, which contributes R173 billion, or 3.4% to the country’s GDP had already lost R21.8 billion in revenue from the first two alcohol bans. The third ban, it said, increased the losses to R30.4 billion.

See also: SAB may be forced to destroy 400 million bottles of beer

SAB, which took the government to court regarding the constitutionality of the sales restrictions, has already cancelled additional investment to the tune of R2.5 billion which it had planned for 2021. An initial R2.5 billion was cancelled in August.

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