Statistics South Africa has released a new report on the items which have seen the biggest rise in prices over the last year.
According to the report, South Africa’s consumer inflation rate jumped to 4.5% in April after reaching a seven-year low of 3.8% in March. Much of the increase was a result of price rises in product groups that attract specific taxes, namely alcohol, fuel and sugary drinks, Stats SA said.
A one percentage point increase in value added tax (VAT) also came into effect in April. The exact impact on inflation is not yet entirely clear in the data, since VAT is not paid on all goods and services, and the introduction of the higher rate is being treated differently by providers.
“Motorists in particular have felt the pain,” Stats SA said.
“The price for inland 93 octane petrol increased by 69c/l in April, of which 52c was a result of tax increases. Fuel prices in general have risen by 9.0% over the past 12 months, placing fuel as the number one product (on par with meat) with the highest year-on-year price increase.”
“Those who enjoy their alcoholic beverages have also felt the pinch,” it said.
“Excise taxes on alcohol and tobacco, which came into effect in February, are slowly permeating the market as retailers fill their shelves with new stock. Prices for alcoholic beverages climbed by 1,2% in March 2018 compared with February 2018, according to the inflation data, followed by a further 1.6% increase in April. Beer experienced an annual price increase of 8.0%.”
It added that brandy and whiskey drinkers weren’t as heavily affected, but not by much, as they are paying 7.6% more for spirits than they did a year ago.
In addition, the new Health Promotion Levy or ‘sugar tax’ on cool drinks which came into effect in April resulted in average increases of 4.5% for a bottle and 5.0% for a can of carbonated soft drinks.
“Interestingly, cell phone fees increased by 2.6% in April. This index normally shows very little movement and this is the largest monthly increase since 2008 when Stats SA started recording the prices of cell phone fees,” Stats SA said.
According to a report there were also items in the inflation basket that experienced a fall in price over the last 12 months.
These include fruit prices (-8.2%), bread & cereals (-3.7%), desserts & sweets (-1.5%), and oils & fats (-1.0%).