Minimum alcohol pricing would fuel black market, bad for fiscus & consumers' health - SALBA

702's John Perlman interviews Kurt Moore, CEO of the South African Liquor Brand Owners Association (SALBA).

The debate around minimum pricing on alcohol has been ongoing since National Treasury proposed the introduction of a minimum unit price (MUP) for liquor products, towards the end of 2024.

The argument put forward by Treasury included the premise that the cheaper alcohol is, the more it is consumed and 'the greater the level of related harm'.

SALBA's Kurt Moore maintains that the problem is not with South Africa's laws around liquor, but with the enforcement of those laws.

He highlights the huge problem we have with the sales of cheaper, illicit liquor, boosted when restrictions were imposed on alcohol consumption during the COVID pandemic.

"One in five alcoholic products sold in South Africa, or 18%, are illicit. It's a particularly big problem for spirits where the figure is 53%. So government is losing significant amounts of revenue - R16.5 billion, of which 10.6 is from spirit sales."

Kurt Moore, CEO - South African Liquor Brand Owners Association

"Now if we aren't enforcing the laws and not collecting that tax, then by increasing the purchase price artificially, all we're doing is creating bigger margins for those operators who will then continue to grow these products."

Kurt Moore, CEO - South African Liquor Brand Owners Association

Along with the loss to the fiscus, one must consider the health risks to the population that accompany these booming sales of illicit alcohol.

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Moore cites the recent testing done by the University of KwaZulu-Natal, which showed 29% of respondents knew of somebody who had died from consuming counterfeit alcohol.

67% said they would buy illicit products despite concern around the health risks because they couldn't afford to pay more, he adds.

"These illicit operators don't pay taxes and they don't comply with the Liquor Products Act, which sets out exactly what you can and also as importantly what you CAN'T add into a liquor product. And if the Act's not applied, they're actually potentially putting products on to the market which could kill consumers."

Kurt Moore, CEO - South African Liquor Brand Owners Association

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