South Africans are anxiously awaiting the outcomes of Finance Minister Enoch Godongwana’s National Budget Speech, taking place on Wednesday, 22 February 2023. Citizens are particularly concerned about whether there will be an increase in the two main levies attached to the petrol and diesel prices: the General Fuel Levy and the Road Accident Fund Levy.
“These levies directly impact the cost of fuel, which in turn affects consumers’ cost of living and businesses’ operating expenses,” says Fabio Longano, Founder and Managing Director of digital product and solutions specialists TouchFoundry, which has recently relaunched its free fuel price prediction app, Fillapp.
“Although an increase in the General Fuel Levy and the Road Accident Fund Levy may be inevitable, as Government seeks to reduce the budget deficit and meet its revenue targets, I would like to urge the Minister to adopt a cautious approach and take into consideration the impact that any increase might have on consumers, especially those who are already struggling to make ends meet,” he adds.
Longano points out that, if there is an increase, it will come into effect from 1 April, coinciding with the 18.65% electricity tariff price hike. “And, if the fuel price trend for February and March is anything to go by, this could be further compounded by another increase in April. Already, more than half (55.5%) of South Africa’s total population – around 30.4 million people – live below the country’s upper-bound poverty line of R1 417 per month. How will they cope with all these increases, let alone the 25,2% of those who live below the food poverty line of R663,00 per month, and how many more people will be plunged into poverty as a result?”
“Last year, a temporary reduction in the General Fuel Levy was announced to provide limited short-term relief to households from rising fuel prices following the Russia/Ukraine conflict. I implore Government to do the same this year. As South Africans, we understand that Government is under immense pressure to resolve the country’s energy crisis and will require additional resources to do so. However, the fuel levy is just one of many revenue-raising measures and others that do not drain already stretched South Africans must be explored,” he concludes.
