Smokers will be coughing up R620-million in additional revenue for the fiscus during the 2005/06 financial year, thanks to an increase in excise duties.
Presenting his Budget in Parliament on Wednesday, Finance Minister Trevor Manuel said excise duties on tobacco products would be increased by between 7,5 and 14,9%, with immediate effect.
”A packet of 20 [cigarettes] will cost you 52 cents more,” he told MPs.
Those who enjoy a drink or two will be made to swallow hard — excise duties on alcoholic beverages are to increase between 9,4 and 20%, adding R960-million to the country’s coffers.
The coming 2005/06 financial year is the second to see a phasing-in of agreed tax burdens (excise duty plus VAT) on alcoholic beverages, set at 23% on natural wines, 33% on clear beer and 43% on spirits.
This will see tax on beer increasing — a 750ml bottle will cost 11 cents more, and the price of a 340ml can will rise by five cents.
Traditional African beers were the only beverages to escape increases in excise duty, which in real terms will make them 4,2% cheaper than last year.
Fortified wine will rise by 23 cents for a 750ml bottle; natural wine by 18 cents a bottle; and sparkling wine by an average of 65 cents a litre.
”Ciders and alcoholic fruit beverages go up by five cents per 340ml can,” Manuel said.
Duties on spirits would jump by R1,47 for a 750ml bottle.
The combined increase in so-called sin taxes would raise an additional R1,6-billion in revenue, Manuel said.
However, ”in keeping with these health-related fiscal measures, we propose also to abolish excise duties on sun-protection products, at a cost of R10-million a year.”
Manuel also announced a nine percent increase in air passenger departure taxes, which will increase to R60 for travel to Southern African Custom Union countries, and R120 for international departures to other destinations. – Sapa