The South African government has deferred the payment of US$300 million in excise duty on liquor sales owed to it by the country’s alcohol industry for 90 days starting in August, APA learnt here on Wednesday.National Treasury said it granted the moratorium following the liquor industry’s request to suspend the payment to ease its economic plight during the lockdown’s ban in alcohol sales.
Due to this development, South African Alcohol Industry spokesperson Sibani Mngadi described the deferment as “a big relief.”
“The cost of excise tax is a significant part of the cost of doing business, and we appreciate the positive response we have received from the National Treasury,” Mngadi said.
He said this would go a long way “in minimising the risk that we currently have about employment and honouring our obligations to suppliers.”
He said the sector was now negotiating with government for the ban to be lifted so that it could resume paying the taxes.
“We are negotiating with the government and put forward a couple of proposals on how we can open safely and try and minimise the concerns around alcohol abuse.”
The government’s alcohol sales ban was effected due to fears that alcohol consumption-induced accidents were overwhelming South Africa’s healthcare system at the expense of treating COVID-19 patients.