Sin Taxes in Lesotho

The Lesotho Government has now introduced sin taxes in the Kingdom of Lesotho. The Tobacco and Alcoholic Products Levy Act, 2023 was enacted on 27 January 2023.  The Act makes provision for the payment of levies pertaining to tobacco and alcohol products.

This levy can be charged by Value Added Tax (VAT) registered businesses upon the sale of tobacco and alcohol products, Revenue Services Lesotho (RSL) or customs officials at all ports of entry into Lesotho, as well as by businesses and individuals (private shoppers).

  Rates of Levy  
  Alcohol products   15%  
  Tobacco products   30%  

The World Health Organisation defines sin taxes as excise taxes targeting goods that can be detrimental to the health of the population. These taxes seek to deter people from engaging in socially harmful activities and behaviours.

Sin taxes on tobacco and alcohol are non-distortionary taxes which have a dual benefit namely:

  • raise fiscal revenue; and
  • reduce health hazards associated with tobacco related diseased and alcohol abuse.


According to a study conducted by the World Bank, Lesotho has 20% of daily adult smokers and the second highest tobacco consumption rate in Africa. Similarly high rates in alcohol consumption are prevalent in the country as well.

The Government of Lesotho intends to use this legislation as an instrument to influence acceptable or normal consumption of tobacco and alcoholic products. The Act is also expected to increase revenue gain in order to provide for developmental programmes.

Disclaimer: The information provided herein should not be used or relied on as professional advice.  No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein.  Always contact your professional advisor for specific and detailed advice.