Government considering ways of lowering fuel levy

The possibility of reviewing the fuel levies downwards to ease the financial burden on motorists and consumers has not been ruled out, President Cyril Ramaphosa said in parliament.

“The fuel levy is part of fiscal architecture we have in our country … We have said we want to look at that … the fuel levy is precisely one of those we are looking at.

“We are sensitive to the burden imposed on our people.”

The price of fuel recently went up to more than R16 a litre in inland provinces. The hikes are expected to have a ripple effect on the economy.

The price of a litre of petrol in SA has more than doubled in 10 years, while the levies increased from about R1.30 in 2008 to the current R5.30.

The fuel levy contributes close to R63bn annually to the fiscus. The Road Accident Fund levy accounts for R1.93 of the fuel price. Taxis and other public transport operators have already upped their fares in response to the increases.

Ramaphosa said any decision would have to weigh the advantages of reducing the fuel levy against the loss of revenue for the state, which will have an effect “on a whole lot of things”.

“We import a commodity we have no control of in terms of prices,” Ramaphosa said.

DA leader Mmusi Maimane asked Ramaphosa whether there was a plan to reduce the fuel levy, which he called a corruption tax.

Department of energy officials told parliament on Tuesday that any adjustment to the fuel levy could only take place in the next financial year.

Ramaphosa also answered questions on the unemployment crisis and the burning issue of land expropriation without compensation.

“Since 2009 I have heard about plans and summits, yet millions of South Africans are still unemployed,” Maimane said. “Can we bring change so we can expect a different economic trajectory?”

Ramaphosa said the cabinet would soon announce details to stimulate economic growth, including finalising the Mining Charter and allocation of broadband spectrum.

“We want to unlock the levers that hold the economy back.”

The president hit back at Maimane, saying: “I’ve not heard anything wise that you’ve said…Youareplayingthepeople or the man, not the substantive issues that have to do with economic growth.”

Without land redistribution there would be no stability in the country, Ramaphosa said.

“Transformation means we must have redistribution of land because there was an injustice committed many years ago … If you do not want stability then do not transform … but if you want stability then you must transform … We will make sure that our country succeeds. Even the landowners must embrace this process,” he said.