On the other hand, while MUP does not increase revenue for the Treasury directly – it potentially does this for retailers, who get bigger margins on every item sold – government increases tax revenue indirectly through the increase in VAT from higher prices. In addition, the government benefits from the savings incurred from lower alcohol consumption – i.e. a reduction in health-, welfare-, labour- and crime-related costs. MUP also does not rule out excise tax increases, which can be implemented alongside MUP.
International successes The experience from other countries around the world is that taxing alcohol at a rate closer to its total cost to society makes for a safer, healthier and more prosperous nation. Scotland, Wales, Australia and Russia have all introduced MUP. Scotland experienced a drop of 4-5% in alcohol consumption among the heaviest of drinkers. Since Russia introduced MUP for vodka – the most commonly abused alcohol in that country – there has been a reduction in overall mortality rates.
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South Africans are renowned to be heavy binge drinkers. Even though the majority of South Africans do not drink at all, those who do drink consume large volumes of alcohol, which is particularly cheap in South Africa.
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