Beware dangers of cheap illicit alcohol
Deadly additives used to give it a kick can kill the unwary drinker
THE illicit alcohol industry in SA poses a huge threat to the legitimate alcohol industry, as well as to public health and the government fiscus, and as illicit alcohol is not taxed, regulated or recorded there is little information available on the patterns of its consumption and the related outcomes.
In addition to evading excise duties and taxes on their products, illicit alcohol blenders have little regard for sanitation and the safety of consumers. Their products are often toxic and, if consumed in sufficient quantity, can be life-threatening.
There are also no firm figures on how much illicit alcohol is manufactured in the country annually. It is estimated that illegal alcohol operators generate millions of rands in tax-free revenue. These operators are usually directly involved in the sourcing, manufacturing, distribution and trading of illegal liquor products and are often associated with organised crime.
Illicit-alcohol operators employ a number of modus operandi, such as:
The use of cane spirit and colourants to replace grape spirit in the manufacture of brandy;
Methanol (a cheap industrial spirit that can be toxic) to replace ethanol in the manufacture of white spirits such as gin, cane, and vodka; or
Inexpensive cane spirit smuggled into SA from, for example, Swaziland is used in the manufacture of illicit white spirits such as gin, cane and vodka.
The illicit manufacturers then use this alcohol to either produce their own brands or alternatively clone or counterfeit well known legitimate brands.
However, cloning a well-known brand takes more effort as they have to produce a fairly high-quality alcohol and copy the original branding and materials, such as the labels, bottles, and bottle caps. Another common way is refilling old, branded spirit bottles, from dumps with the illicit alcohol. The spinoff is that they are then able to sell their illicit products at below the cost of the legitimate brands and avoid having to pay excise duties, which all equates to substantial profits.
The excise duty payable on a 750ml bottle of gin, cane or vodka is R27,27. If you then add the cost of packaging, manufacturing and product, a bottle of alcohol will cost about R38 before the wholesale mark-up. As illicit alcohol manufacturers do not pay excise duties they are able to sell their products at below the cost prices and distribute to legitimate bottle stores and outlets, of- fering a combination of both illicit alcohol and legitimate brands at a discounted price, thereby enticing retailers to purchase their products.
Consumers need to be wary of abnormally low-priced products as this is one way of identifying illicit products. Aside from the inexpensive cost, illicit alcohol is usually of a low quality and can pose serious health threats. Therefore, be suspicious of white spirits on offer at below R38 a bottle. These are often advertised as on promotion or a special deal or a loss-leader.
Over the past few months there have been a number of breakthroughs in the fight against illicit liquor operators, with key role-players being arrested and facing charges of fraud, evading value-added tax (VAT), excise duty and kite-flying — the unlawful gen- erating of funds in bank accounts by means of depositing stolen or worthless bills of exchange. The South African Police Service (SAPS), working with with the South African Revenue Service (SARS) and the Department of Agriculture, have raided numerous premises throughout SA and closed down a number of bottling plants and confiscated illicit alcohol products.
At some of these illicit alcohol operations it was found that conditions were unacceptable under the Foodstuffs, Cosmetics and Disinfectants Act, 1972, in that most of the bottles containing additives such as colourants and flavourants used in blending the illicit alcohol were beyond their expiry dates, in some cases by several years. Further, tartrazine was contained in some of the additives but not reflected on the product labels.
Floor areas and blending drums where the alcohol was being manufactured were dirty and unhygienic, and unsealed bags of malic acid and sugar were stored directly on the factory floor, which potentially could lead to dirt or contamination by pests.
With officials taking serious action against illicit alcohol trading and highlighting the dangers that these potentially lethal products pose to the public there is hope that perpetrators will dwindle and that consumers will refuse to buy cheaper alcohol on offer, thereby decreasing demand for these inferior and often dangerous products.
Liquor outlets need to think twice before putting illicit alcohol products on their shelves and consumers have to be sensitive to the dangers of consuming illicit alcohol products.
If the price of your next bottle of gin or vodka appears to be too good to be true, it probably is.