DA calls on Energy Department to explore the rationalisation of the fuel tax system

30 November 2021

In response to the recently announced upward revision to the fuel price by the Department of Energy, which is likely to add significant pressure on the economy and the commuting public, the DA again calls on the government to review the current fuel pricing model.

It is long past time that South Africa review its fuel pricing. Minister Mantashe is derelict in his duties in this regard: the DA, and others, have on several occasions requested that this review take place, but our correspondence has been completely ignored.

The DA therefore the Department of Energy to conduct exploratory research on the possible rationalisation of the fuel tax system.

It has become increasingly clear that the various fuel taxes, such as the Road Accident Fund (RAF) Levy, are adding to the cost pressures on the fuel cost per litre, which now stand at all-time record highs. Add to this the fact that the RAF is fraught with challenges, the South African government may be left with very few options other than to consider alternatives to the Road Accident Levy.

The Road Accident Fund Levy has not only become a key driver of the total cost per litre, but its poor administration by the Road Accident Fund has instead created a R300 billion funding deficit.

Exploratory research on the rationalisation of the fuel tax system by the Department could be a critical first step towards bringing down the price of fuel.

The current fuel pricing model is killing South African consumers. After years of economic decline due to ANC mismanagement, corruption and looting, and the harshest Covid-lockdown in the world forcing our economy to a near standstill, South Africans simply do not have the financial means to afford the fuel hike.

Issued by Kevin Mileham, DA Shadow Minister of Mineral Resources and Energy, 30 November 2021