SALBA to apply for break in paying excise duties

The alcohol industry pays Sars an average of R2.5 billion per month in excise tax contributions for locally produced and imported products.

FILE: President Cyril Ramaphosa this week announced the ban would stay in place until further notice. Picture: 123rf.com

CAPE TOWN - One of the big players in the alcohol industry said the decision to prohibit sales had left sector with no choice but to apply for a deferment of the payment of excise duties until the ban was lifted.

President Cyril Ramaphosa this week announced the ban would stay in place until further notice.

The South African Liquor Brand owners Association (SALBA) on Wednesday said this had a profound impact on jobs and livelihoods.

READ: SA Medical Research Council: Underground market alcohol can be lethal

The alcohol industry pays Sars an average of R2.5 billion per month in excise tax contributions for locally produced and imported products.

In July and August last year, the alcohol sector was granted deferment of at least R5 billion in excise tax payments when the government banned alcohol sales with immediate effect.

Payments resumed in October 2020 when sales were allowed again.

The SALBA’s Sibani Mngadi said there was is no Temporary Employer/Employee Relief Scheme for any of the SMMEs in the sector including taverns, restaurants and bars.

“Opening alcohol sales for home consumption will bring some relief to the economic strain faced by the industry and these sales have no impact in increasing COVID-19 infections or on the health system.”

Alcohol excise tax is imposed at the point of production.

READ: SAB: Alcohol ban infringes on the rights of South Africans

This means alcohol companies have a liability to pay the tax on end products in their warehouses and which cannot be sold due to the current indefinite prohibition of sales.

WATCH: Adjusted level 3 & alcohol ban remain but curfew changes

Download the Eyewitness News app to your iOS or Android device.