CHAMWE KAIRA
Consumers can expect prices of alcohol products and cigarettes to go up in line with the Southern African Customs Union (SACU) excise duties when Minister of Finance, Ipumbu Shiimi tables the 2024 budget next week.
This week, South African Minister of Finance, Enoch Godongwana said for alcohol products excise duties, above-inflation increases of between 6.7% and 7.2% for 2024/25 are proposed.
This means a can of beer increased by 14 cents, a can of a cider and alcoholic fruit beverage went up by 14 cents, a bottle of wine will cost an extra 28 cents, a bottle of fortified wine will cost an extra 47 cents, a bottle of sparkling wine will cost an extra 89 cents; and a bottle of spirits, including whisky, gin or vodka, increases by R5.53.
Godongwana also proposed to increase tobacco excise duties by 4.7% for cigarettes and cigarette tobacco, and by 8.2% for pipe tobacco and cigars. This translates to a R9.51 cents increase for cigars, a 97 cents increase to a pack of cigarettes; and and an extra 57 cents for a pipe of tobacco.
On environmental taxes, the carbon tax increased from R159 to R190 per tonne of carbon dioxide equivalent. The carbon fuel levy will increase to 11 cents per litre for petrol and 14 cents per litre for diesel effective from 3 April 2024.
He said despite the improved global outlook for 2024, South Africa’s near-term growth remains hamstrung by lower commodity prices and structural constraints.
“We estimate real GDP growth of 0.6% in 2023. This is down from 0.8% growth estimated during the 2023,” he said.
Godongwana said compared to a year ago, the budget deficit for 2023/24 is estimated to worsen from 4% to 4.9% of GDP.
The higher budget deficit means that debt-service costs in 2023/24 have been revised higher, by R15.7 billion to R356 billion, he said.
“Debt-service costs will absorb more than 20 per cent of revenue.”
