In his Budget Speech delivered on Wednesday (25 February), Finance Minister Enoch Godongwana announced that consumers will pay higher prices for tobacco, alcohol, and petrol—starting from 1 April 2026.
“Increases to certain taxes are unavoidable. For 2026/27, excise duties on tobacco will be increased in line with inflation,” said Godongwana.
“This includes excise duty on electronic nicotine and non-nicotine delivery systems,” he said.
The price adjustments to tobacco and alcohol are announced as follows:
Tobacco
- The tax on a 20-pack of cigarettes has increased from R22.81 to R23.58.
- The price of pipe tobacco has risen by 28 cents per 25 grams.
- Cigarette tobacco has increased by 87 cents per 50 grams.
- The price of cigars has gone up by R4.56 per 23 grams.
Alcohol
The excise tax on alcoholic beverages has also risen in line with inflation.
- A 340-millilitre can of beer or cider will now cost eight cents more.
- A 750-millilitre bottle of wine has increased by 15 cents.
- A 750-millilitre bottle of spirits will rise by R3.20.
Diageo South Africa, the company behind brands like Johnnie Walker, Smirnoff and Captain Morgan, welcomed the Finance Minister’s decision to limit the increase in alcohol excise tax to the expected inflation rate of 3.4%.
This adjustment keeps the excise tax on spirits at R97.66 per 750ml bottle, successfully avoiding a per-bottle tax exceeding R100.
The spirits company said it also welcomes the minister’s commitment to engage stakeholders in reviewing the current excise tax policy on alcohol.
“We believe that this policy review is an opportunity to establish equity in the taxation of alcoholic beverages and to limit the growth of illicit trade arising from high levels of taxation,” said Diageo.
Diageo said it is dedicated to actively participating in the tax policy review process to enhance the sustainability of the alcohol industry and its role in South Africa’s economic growth.
“Furthermore, we support the efforts announced by the President and the Minister of Finance to deal with illicit trade in alcohol, tobacco and fuel,” said Diageo.
