The South African economy suffered a fiscal loss of R6.4bn ($492m) in 2017 due to illicit alcohol activities, which generates an annual revenue of R12.9bn and goes unregulated. In addition, cheaper, therefore more accessible, illegal alcohol products encourages binge drinking and under age alcohol consumption and poses a serious risk to the health and safety of individuals as they contain potentially dangerous substances. This is according to a Euromonitor International study undertaken to determine the impact of the illicit trade of alcohol in seven African countries, including S Africa. The study, which engaged local manufacturers, trade associations and government, amongst other relevant stakeholders, highlighted that the largest share of the fiscal loss was attributed to smuggling of final alcohol products and raw ethanol used in the production of alcohol, amounting to R4.2bn. Tax leakage is the next highest contributor to the fiscal loss in 2017 at R2bn. Across the globe, Euromonitor estimated that 1 in 4 alcohol bottles consumed are illicit.
