Charlene Roo | July 27, 2025
South Africa's beer industry is more than just a source of refreshment. This is an economic powerhouse woven into our country's cultural and economic structure.
In 2023 alone, Oxford Economics' World Economic Footprint Survey found that in 2023 alone it contributed R96.4 billion to GDP, generating R56.5 billion in tax revenues and supporting more than 210,000 jobs.
As the South African Beer Association (BASA), our mission is to protect and promote the industry and the livelihoods it sustains.
But we cannot do so without fair and forward-looking regulations – especially with regard to excise tax policies that have reached an unsustainable turning point.
Reflect: Brewing under pressure
Despite its contribution, the beer industry is growing tension. The national budget for 2025/26 saw an increase in excise tax on alcohol by 6.75%, continuing the pattern of hiking over inflation.
Large players may be able to absorb some of the blows, but many small and craft brewers cannot. This results in reduced closures, unemployment and sector diversity.
Currently, excise tax and VAT combine to account for up to 40% of the price of 340ml beer.
For township taverns and community brewers, microentrepreneurs often – this is unsustainable. These are not just business, they are the lifelines of economically marginalized communities.
Adding fuel to fires has introduced a sharp increase in licensing fees across manufacturing and retail categories in some states.
For small players, these increases allow them to approach non-compliance, or, worse, illegal activities – not from malicious intent, but necessity.
The illegal alcohol market is already growing threat. According to EuroMonitor, illegal alcohol consumption increased by 10% between 2017 and 2020, accounting for 22% of total consumption.
The lack of enforcement, exacerbated by high taxation and regulatory burdens, has inadvertently driven consumers and producers underground, eroding both public safety and tax revenue.
Recognition: build bridges, not barriers
Over the past year, BASA has deepened cooperation with governments, from the social development sector to state liquor authorities, restructuring its understanding and policy regarding beer.
These partnerships are beginning to pay off with greater openness to constructive engagement and joint problem solving.
He also completed a national beer recognition survey to clarify important misconceptions. Most notably, beer is widely seen as a high alcohol product, but in fact it has one of the lowest ABVs in the alcohol category.
This insight helps us sharpen public messaging and promote responsible consumption alternatives.
On the ground, they invest in the skills development of tavern owners, SMME brewers and emerging entrepreneurs. Many of them took part in trade not from choice but from economic despair.
In many cases, they lack formal business training and have been stagnant for decades due to lack of access to fundraising, compliance know-how and basic marketing skills.
Our support includes short courses in financial management, licensing and social media marketing, and we partner with the university to enhance our brewing as a science and career, particularly for young black South Africans and women who are underrepresented in the industry.
Rekind: SA's new vision for beer
With our eyes ahead, we have three focuses:
It reframes conversations not only as products but as drivers of employment, tourism, township economy development and heritage. This is especially important during the October shipping month and the stage into the festive season. Here we promote low- and zero-alcohol options under the “Go Zero” campaign.
We will try out the “One Size Fit” excise tax model. The increase in blankets ignores the differences between multinational brewers and township-based microoperators. A differentiated consumer framework, or increased SMME support, is essential to leveling out the arena.
We invite SMME Support agencies to include alcohol-related companies in their development missions. These are legitimate businesses that support households and communities, and deserve the same support as other entrepreneurs.
Brewing a sustainable future
If governments are serious about inclusive economic growth, they must recognize the role of beer in the socioeconomic ecosystem of South Africa.
Approaching the Medium-Term Budget Policy Statement, BASA will continue to engage with the National Treasury Department and request a review of the current excise policy development process.
A more transparent and predictable process is essential to addressing policy uncertainty. This is currently undermining investor trust and business sustainability, especially for SMME.
South Africa's beer industry is ready to grow, innovate and lead.
But you can't do that in a tax system that brews failure. The time to act is now.
Charlene Louw, CEO of the South African Beer Association (BASA).
“Disclaimer – the views and opinions expressed in this article are the views of the author and are not necessarily those of the Bee Room.”
