Adrian Botha, the director of the Association for Responsible Alcohol Use, believes that the government is a little betwixt and between two stools over plans to ban alcohol advertising. He points out that there has been talk about a ban “on and off for years”.
The issue was raised by former health ministers Nkosazana Dlamini-Zuma and Manto Tshabalala-Msimang, and the ANC Youth League raised it nine months ago.
While Health Minister Aaron Motsoaledi “extremely strongly” called for a total ban during the television programme Special Assignment, Botha pointed out that the Department of Trade and Industry – which has oversight on matters of alcohol advertising – was more cautious.
At a recent drug and alcohol abuse summit in Durban, Department of Trade and Industry officials articulated the need for balance. Botha ascribed this to the fact that the department’s mandate was to promote business “while regulating alcohol use… what they are looking for is a balance”.
Robyn Chalmers, the communications head at SABMiller’s local unit, responded to a potential ban by indicating that SAB “shares the concern of government regarding the unacceptable level of alcohol abuse in South Africa and we look forward to working with government to put measures in place to fight the abuse of alcohol”.
But she added that there were “more effective ways” than imposing restrictions on alcohol advertising and licensing, increasing consumption age limits and raising taxes on alcohol.
SAB believed that a more effective way to address alcohol abuse was through targeted interventions and “focusing on those drinking patterns that are associated with harm”.
Proven approaches included improved education, good enforcement and strong self-regulation. “These are approaches that SAB seeks to drive through its ongoing alcohol strategy on which the company has spent more than R100 million since its inception in 2009.”
The first shots in Motsoaledi’s “war on alcohol” have been fired.
There is a great cartoon in a recent issue of the New Yorker magazine with two lawyers – or financial engineers – sitting around a desk contemplating new regulations with slightly furrowed brows.
“These new regulations will fundamentally change the way we get around them,” says one to the other.
So the guys at the National Treasury and the SA Revenue Service (Sars) might take some comfort from the realisation that the onslaught of complaints that followed their recent rather dramatic announcements was not something unique to South Africa.
It is almost inevitable that any new piece of general legislation will produce howls, or perhaps just whimpers, of protest; when it comes to tax legislation, it is a dead certainty that changes will result in an uproar as well-heeled sectors of the business community, or their paid advisers, rush to register their displeasure.
The suspension of section 45 of the Income Tax Act and the proposed changes to the tax treatment of preference shares certainly came as a surprise to most corporates and their financial advisers.
The section 45 suspension should not have surprised anyone who was keeping up to speed with the evolution of tax law.
When the facility was initially introduced years ago, Sars stressed that it was a temporary provision designed to allow some rather unwieldy conglomerate entities to be restructured.
Such restructuring, it was believed, would result in increased economic efficiency and should not trigger a tax liability. It was always going to be a temporary reprieve.
But so strong is the sense of entitlement in our corporate community that very quickly there was a presumption that they were entitled to rely on section 45 forever.
The fact that section 45 is rarely used for genuine black empowerment transactions has not stopped the financial engineers from claiming it will damage black economic empowerment.
That claim is far more valid for the preference share proposal.
Edited by Peter DeIonno. With contributions from Donwald Pressly and Ann Crotty.