Gauteng to hike liquor licence fees and digitise applications to fix broken system

Gauteng Economic Development MEC Vuyiswa Ramokgopa, is moving to shake up the province’s liquor licensing system.

This comes after she revealed that the multi-billion rand alcohol industry generated just R74.5 million in licensing revenue during the last financial year.

The proposed reforms include increasing liquor licence fees, which Ramokgopa noted have not been raised in seven years. She argued that this stagnation has left regulators underfunded and struggling to enforce compliance.

Speaking on Monday, Ramokgopa cited a report that exposed widespread governance failures at the Gauteng Liquor Board. She stated that her plans will effectively reset the Board and other entities falling under her department.

The MEC explained that the province is now pushing to digitise liquor licence applications to clear massive backlogs and make it easier for businesses to trade legally.

The current system is slow and dysfunctional, she noted, with some applicants waiting more than two years and in some cases, over five years for a response.

“We are firmly of the view that we have to expedite the moving to a digital application process, which will facilitate that and also help us to increase the size of the pie,” Ramokgopa said.

According to Ramokgopa, the provincial government is actively trying to raise revenue but has only seen a fraction of potential licensing fees from the multi-billion rand industry. Collecting less than R80 million in the last financial year is unsustainable, she added.

“That is the full size of the purse that we then have available to us to actually do our work of regulating this industry. Those ratios are completely off.”

She warned that this weak revenue base has severely crippled effective regulation across the province.

While licence fees are set to go up because they have remained stagnant for seven years, the department has already faced criticism for the decision. Opponents of the move have pointed out that the increase comes at a time of severe economic uncertainty for businesses.