Budget 3.0: Alcohol and cigarette prices will increase — here’s by how much

Finance Minister Enoch Godongwana’s third draft of the widely disputed budget has given little relief for consumers of cigarettes and alcohol.

The minister delivered his second budget speech in three months on Wednesday after budget 2.0 collapsed over the proposed hike in Value Added Tax (Vat).

Godongwana’s first attempt in February was postponed without a word being spoken, and hopes are high that this version will be voted for by the national assembly.

Excise duties still up

As with the previous speech, excise duties were not specifically mentioned, but were detailed in an accompanying document.

“The March 2025 Budget Review outlined tax proposals for 2025/26 and 2026/27. Except as otherwise indicated below, these proposals stand unchanged, including for personal income tax, transfer duties and excise duties,” the May budget overview stated.

Industry leaders were not expecting any change to the earlier version, stating that the government had played their alcohol and cigarette hand as much as they could.

“We honestly did not expect that the minister would increase excise duties from the original and budget 2.0 version as the increase was already at inflation plus 2%,” National Liquor Traders Council convenor Lucky Ntimane told The Citizen.

“There really is not enough money to be raised in excise as a percentage increase can only give you an extra R100 million,” he explained.

Alcohol and cigarette increases

While excise duties were not changed, enjoyers of alcohol and cigarettes will still be paying extra in the coming financial year.

Excise duty on cigarettes and all other tobacco products, including vapes, will increase by 4.75% or an extra R1 on the average box of cigarettes.

Wine, spirits and beer will all be increasing by 6.75% in the next financial year, while the cost of traditional African beer will not be increasing.

The increases will add an extra R1.20 to a bottle of sparkling wine, R6 to a bottle of spirits and an extra 16 cents to a can of beer.

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