The ban on the sale of alcohol has not only had a devastating effect on many producers, like SA Breweries, but also means a loss of billions of rand in excise tax.
As with most industries, breweries across the country find themselves in uncertain times as lockdown restrictions continue to throttle the beer industry. A national state of disaster was declared on 21 March and lockdown started on 26 March. Since then, the sale and transportation of alcohol has been prohibited. A particularly worrying situation involves South Africa’ largest brewery – AB InBev’s South African Breweries .
A reported job cut threat at the end of January saw the possibility of up to 500 people losing their jobs – an estimated 8% of its workforce. But the super brewer will be hit even harder if 132 million litres of beer will have to be destroyed, as is currently feared. Lisa confirmed to The Citizen that the discarding process had already begun, with some brewers having to discard beer daily.
“This would literally be pouring that tax revenue down the drain, at a time when government – and the citizens of South Africa – have an urgent need for those funds.”If SAB is forced to discard its current inventory, it would be forced to operate at 50% capacity for at least four months. In June last year, alcoholic beverages, along with tobacco and narcotics, accounted for 4.5% of household expenditure in South Africa, with a growth rate of 2.9%.
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