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Illicit alcohol still skirting sin taxes with negative impact

The imposition of higher taxes on alcohol and legislation, such as the proposed ad ban and the Gauteng Liquor Act, focuses on the regulated industry, but not much is being done to address issues that stem from the non-regulated industry.
Consuming alcohol has and always will be an essential element of how communities socialise and, for the most part, people will drink, if they choose to do so, responsibly and in moderation.

However there is a large market for non-commercial alcohol, which is unregulated and can have far reaching negative health effects, particularly on poorer communities who cannot afford commercial alcohol.

Illicit alcohol has not been put through the same rigorous compliance and testing standards as commercial alcohol. Mixed with ingredients from common household products to stolen jet fuel, the people consuming illicit alcohol are simply purchasing what they can afford, regardless of quality or risk.

Government regulation

Government has tried to regulate the alcohol industry through the implementation of stricter legislation including the potential advertising ban and using taxes to drive up the price as a means to curb the harmful effects of alcohol and reduce consumption. However these measures are focused on the regulated industry, which already adhere to a code of conduct outlining their responsibility in terms of marketing and awareness and does not address the illicit alcohol trade.

Additionally these measures have other unintended consequences. The Gauteng Liquor Act for example, which seeks to ban the sale of alcohol on a Sunday, will make it more expensive and difficult for formal alcohol traders while increasing sales through illegal outlets.

The production and sale of illicit alcohol is just one of the unintended consequences that may decrease, rather than increase, public health and safety. While consumers may shift consumption to low quality non-commercial alcohol and illegally traffic in smuggled or counterfeit goods.

The problem is not unique to South Africa and other African countries each have their own concoctions of illicit alcohol. The descriptive names indicate the potency of these mixes. Zimbabwean 'Scud'; Botswana's 'Tho-tho-tho (the dizzy spell); Nigerian palm-wine (Crazy Man in the Bottle) and Kenya's 'Jet-5' made from stolen jet fuel are just a few examples.

Illicit stills produce dangerous mixes

Meanwhile in South Africa, senior lecturer Dr Jabulani Makhubele from the department of social work at the University of Limpopo agrees that home brews are poorly monitored for strength and ingredients. Some mixes include PM10 batteries, car batteries, meths and cheap vodka also known as 'God take me'; marula beer which consists of black label, meths and marula; while V-Power is made up of Jeyes fluid, brake fluid, meths, yoghurt, coke and cocoa. More rural research is needed to understand the prevalence of the problem so that necessary steps can be taken to educate communities.

Although the argument around alcohol producers benefiting from lowered prices resulting in people consuming more than they normally would, can be made, consumers know that with commercial alcohol, they are getting something that is fit for human consumption. The volume of alcohol can be regulated in commercial drinks and there are warning labels on every bottle alerting people to the harmful effects of alcohol abuse.

In addition, commercial alcohol producers are able to work with policy-makers, traders and communities at large to increase education on alcohol abuse and misuse. That is primarily due to the vested interest they have in ensuring consumers choose commercial brands over illicit ones whereas illicit alcohol producers have no incentive to do this, so long as they remain competitive on price.

About Adrian Botha

Adrian Botha is the director of The Industry Association for Responsible Alcohol Use (ARA). The ARA is registered as a non-profit organisation (NPO) with the Department of Social Development and is focused on the prevention of the negative consequences of alcohol abuse. The association's mission is to reduce alcohol-related harm through combating the misuse and abuse of alcohol beverages and promoting only their responsible use.
Read more: Adrian Botha, ARA

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