SA budget flags illicit cigarette trade as major revenue leak and raises excise
Feb 27th 2026
The 2026 South African budget acknowledged widespread cigarette smuggling and raised excise by R0.77 per 20-pack; officials and analysts say lost revenue is large but estimates vary and many call for stronger enforcement at porous borders.
- Budget raises excise on a 20-cigarette pack by R0.77, taking duty to about R23.58 per pack.
- Finance Minister said illicit cigarette trade costs the state roughly R30 billion a year, while some independent studies estimate losses near R100 billion.
- Authorities reported a recent seizure of smuggled cigarettes and a vehicle at the Zimbabwe border.
- Experts warn raising excise without stronger enforcement can increase the price gap that fuels smuggling.
- Accurate measurement of the illicit market remains elusive, making revenue-loss estimates highly variable and enforcement priorities contested.