South Africans' alcohol consumption rises despite declining wealth
Despite a decline in wealth, South Africans have increased their consumption of tax-paid alcohol by 24.2% from 2017 to 2024, challenging claims of a growing illicit market as Treasury considers higher excise taxes.
South Africans increased their consumption of tax-paid alcohol despite the country's economy declining between 2017 and 2024, a trend that challenges claims of a substantial growth in the illicit alcohol market. According to economist Corné van Walbeek of the University of Cape Town, tax-paid alcohol consumption rose by 24.2%, while the population aged 15 and above grew by 14.7%, leading to an 8.3% increase per capita.
However, per-capita GDP fell by 4.7% and household disposable income per capita declined by 1.5%. The industry's claim that illicit alcohol consumption grew by 55% during the same period is disputed, as Van Walbeek argues that the sources supporting this figure do not establish the size or growth of the illicit market. A separate analysis by Van Walbeek and colleague Nicole Vellios suggests that legal alcohol consumption only increased by about 10% after accounting for population growth.
The Drinks Federation of South Africa estimates a 55% increase in illicit alcohol volumes, while the Beer Association of South Africa warns that higher excise taxes could worsen the situation by increasing excise taxes on most beers by 20%.
Written by urgent.news from IOL's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
