'Sinners' dear to Gordhan’s heart

2017-02-22 14:15 - Jaco Leuvennink, Fin24

Cape Town – Finance Minister Pravin Gordhan tried to lift the gloomy mood of a tough budget by joking that he has "not forgotten” about the smokers and drinkers, who are "very dear to our hearts".

But what his words in actual fact meant when he addressed the press before his Budget Speech in the National Assembly was that South Africans will in future pay more for these little pleasures.

Maybe he really just wanted to get back at the journalists sitting in front of him.

As expected however, and has become tradition, the so-called sin taxes - that is, the excise duty on tobacco and alcohol - have been hiked in the budget. Since 2002 these sin taxes have consistently been above the inflation rate and the Budget Review proposes that the increases remain at between 8% and 9.5%.


Smokers will pay R1.06 more for a packet of 20 cigarettes, pipe tobacco will cost 40 cents more for 25 grams and cigars R6.58 more for 23 grams.

As far as drinks are concerned, it seems Gordhan and the Treasury want to stress hard work ahead rather than celebrations because the price of sparkling wine carries the biggest hike, with an increase of 70c for a bottle of 750 ml.

A 340 ml can of beer, or of cider and alcoholic fruit beverages, will cost 12c more, a bottle of fortified wine 26c more and a 750 ml bottle of spirits R4.43 more.

Together with the increase of 30 cents per litre in the fuel tax, the hike in excise duties on alcohol and tobacco will bring in an additional R5.1bn for state coffers in 2017/18.

* Visit our Budget Special for all the budget news and in-depth analysis.

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