The South African Breweries (SAB) has hit back at Transport Minister Barbara Creecy’s proposed total ban on drinking alcoholic beverages while driving, warning it will not necessarily decline consumption but it will shift into the illegal market.

While presenting preliminary road safety statistics for the 2025/2026 festive season last week, Creecy announced plans to amend road regulations to ban drinking while driving, citing road fatalities as a major concern. 

But SAB has argued this move will fuel the illicit liquor trade, threatening the legal industry’s sustainability.

SAB spokesperson Lungile Manganyi said the  brewery giant had already submitted a stark warning to the Tax Policy Review process, arguing that excessive excise hikes will fuel the illicit liquor trade and threaten the sustainability of the legal alcohol industry.

Creecy suggested that the driving and drinking policies that were formulated many years ago are set for a major overhaul.

“In today’s South Africa it is totally unacceptable that there is a law that allows people to drink and drive. I have never understood this. I can not explain this to anyone who has lost their parents, a brother, a sister, or a child as a result of the road accident,” she said.

According to her, the time has come for the government to amend the law to ensure a “clear-cut, easy to understand and unambiguous policy that says drinking and driving are not allowed”. 

“A law that allows drivers to drink a certain amount and then get behind the wheel of a car must be scrapped. So we will begin an amendment to Section 65 of the National Road Traffic Act. If nothing else we owe this to the memory of the many fellow South Africans who have lost their lives on the roads,” Creecy said.

Manganyi warned the government that excessive excise increases above inflation have the unintended consequence of fuelling the illicit alcohol market, undermining compliant businesses and weakening their ability to sustain jobs and contribute to the economy.

He further cited current research that revealed that illicit alcohol accounts for approximately 18% of total alcohol consumption in South Africa “meaning that nearly one in every five alcoholic beverages consumed is illicit”.

“Against this backdrop, any policy proposals that result in above-inflation excise increases must be carefully assessed in light of their trade-offs and unintended consequences,” he said

SAB mentioned that the closure of local production facilities by a major tobacco manufacturer has been attributed, in large part, to the overwhelming prevalence of illicit trade, which eroded legal volumes and undermined the viability of compliant operations.

 “Where legal products become increasingly unaffordable and enforcement against illicit trade remains weak, consumption does not decline — it shifts into the illegal market. The consequences are clear: declining legal sales, job losses, reduced local manufacturing, and ultimately lower tax revenues for the state,” said Manganyi, pleading with the government to avoid the risks in the beer industry.

He added that the current excise adjustment framework stated that the excise duties on alcoholic beverages should increase in line with projected inflation to maintain the real value of the tax.

“The latest research shows that illicit alcohol is now approximately 47% cheaper than legal alcohol, at a time when consumers remain significantly cash constrained, accelerating the shift away from regulated products. Departing from these principles creates market-distorting outcomes. Above-inflation increases on beer risk sending the wrong signals to consumers by disproportionately increasing the price of lower-alcohol products relative to higher-alcohol alternatives.

“This is particularly concerning given the beer industry’s highly localised value chain, with more than 95% of inputs sourced locally, supporting approximately 250,000 jobs from farmers and manufacturers through to distributors, tavern owners and retailers,”Manganyi said.

rapula.moatshe@inl.co.za

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