South African alcohol manufacturers welcome lift of alcohol sale ban, tax payment deferment

SOUTH AFRICA – South Africa’s government has lifted a ban on liquor sales and relaxed other pandemic restrictions, moving to Adjusted Alert Level 3 lockdown, amid hope that the worst of the third wave of Covid-19 may be over.

Its been a month since the country was placed under stricter lockdown restrictions aimed at reducing Covid-19 infections and easing pressure on the healthcare system.

The decision to ease lockdown regulations comes amid a drop in Covid-19 cases, test positivity rates, and hospitalisations, which according to the News24, the average number of daily new infections has dropped 20%.

“The latest figures suggest that we have largely passed the peak of the third wave of infections, although there are areas in the country where we still need to be concerned because the rates of infection have not yet shown signs of decline,” explained President Cyril Ramaphosa.

The contentious alcohol ban has been partially lifted, with the government stipulating a raft of directives that need to be followed.

This includes sale of alcohol by licensed premises for off-site consumption has been permitted between Mondays – Thursdays, from 10am to 6pm.

Meanwhile, sale of alcohol by licensed premises for on-site consumption such as restaurants and taverns have been permitted throughout the week from 10am to 8pm.

The bars and restaurants have been further directed to close by 21:00p.m, ahead of curfew which is in place from 22:00p.m. – 4:00 a.m.

To further ease the burden on the alcohol industry, the government has deferred tax payment of excise taxes by the sector for a period of three months.

“The partial opening of sales as well as three months’ deferment in excise tax payments due on alcoholic beverages is a huge relief.”

Salba Chairperson – Sibani Mngadi

Alcohol industry player welcome announcement

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The South African Liquor Brandowners Association (Salba) has lent its voice to the move indicating that, the relaxation of lockdown restrictions will help some liquor traders, but warned that the last 15 months of bans have come at a significant financial cost to the economy.

“The partial opening of sales as well as three months’ deferment in excise tax payments due on alcoholic beverages is a huge relief, but we are nowhere near being out of the woods, especially for the off-site consumption outlets that continues to be restricted to trading Monday to Thursday with no rationale or evidence provided for this decision, in spite of our many requests to secure this from government,” said Salba chairperson Sibani Mngadi.

Salba Chief Executive Kurt Moore reiterated saying, that 248,759 jobs are still at risk across the industry which is about 1.59% of the national total of formal and informal employment for 2020.

“Even before the cost of the looting to the alcohol industry is factored in, the four alcohol bans have already cost the country’s GDP an estimated R64.8 billion or 1.3% of GDP,” said Moore.

The country’s leading brewer, South African Breweries (SAB) has welcomed the President’s announcement saying it is now the imperative of all South Africans to participate in ensuring a sustainable and inclusive economic growth path.

Zoleka Lisa, Vice President of Corporate Affairs at SAB said, “We believe that opening up the economy and moving the country to alert Level three is an important step towards economic recovery.

“It is an important affirmation that livelihoods and lives are both important considerations in curbing the spread of COVID-19.”

SAB, along with the rest of the alcohol industry, have affirmed their commitment to partnering with the government to create a social compact for driving positive behavioural change regarding harmful consumption of alcohol.

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