National Treasury Defends Excise Duty Policy Amid Illicit Trade Concerns
What happened
During hearings in Parliament, National Treasury and South African Revenue Service defended their policy of maintaining inflation-linked excise duty increases on tobacco and alcohol products. Industry stakeholders warned that legal businesses are losing ground to smugglers and counterfeit operators. Treasury maintained that stronger enforcement, rather than lowering excise taxes, is the appropriate response to the growing illicit trade threat.
From sundayworld.co.za
Why it matters
The policy maintains rising tax burdens on legal manufacturers, who reported facing a tax burden of more than R27 per p for cigarettes. Stakeholders argue that these increases widen the price gap between legal and illegal cigarettes, as illicit operators do not pass on tax hikes.
From sundayworld.co.za
Who's involved
- National TreasuryNational Treasury defended the excise duty policy during parliamentary hearings.
- parliamentParliament held the hearings where the excise duty policy was debated.
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
- South AfricaSpeculative
South Africa might see increased industry costs for legal tobacco and alcohol manufacturers due to maintained excise duty increases.
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The entities involved
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National Treasury
treasury of South Africa
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parliament
legislative body of government
Related events
- Parliamentary debate pressures Reeves' Treasury policy.
- Government bypasses parliament for policy objectives.
- Parliament warns against ineffective industry gatherings while highlighting departmental funding dependencies and defense roles in South Africa.
- Government introduces bills into Parliament for passage.
- Gugile Nkwinti, a minister, tabled a discussion paper in Parliament on November 22, 2012.