Almost half of your petrol money goes to levies

(iStock)
(iStock)

Cape Town - Up to 37% of the costs in the petrol price is allocated to different government levies, according to a breakdown of the fuel price by the Automobile Association (AA).

As of midnight on Tuesday, motorists will have to fork out more for petrol. The cost of a litre of 93 unleaded petrol inland is now R12.32 cents a litre (c/l) and R11.94c/l at the coast.

However, the fuel price this month includes a 30c/l increase to the Fuel Levy announced by Finance Minister Pravin Gordhan during his Budget Speech in February.

The Fuel Levy is a tax collected on every litre of fuel sold and is administered by the National Treasury.

The fuel price, however is made up of many different costs that constitute what is commonly referred to as the petrol price.

The AA explained that the Basic Fuel Price (BFP) is calculated based on costs associated with shipping petroleum products to South Africa from the Mediterranean area, Arab Gulf, and Singapore. These costs include insurance, storage, and wharfage, the cost to use harbour facilities when off-loading petroleum products into storage facilities.

"In April 2016 these costs total R5.26 per litre for 93 unleaded petrol (inland), and R5.21 for a litre of 93 unleaded at the coast."

Other costs associated with the petrol price include:
- transport costs (from the harbour to other areas),
- customs and excise duties,
- the retail margins paid to fuel station owners, and
- secondary storage costs.

The AA added that these other costs also include the Fuel Levy and the Road Accident Fund (RAF) Levy.

The Fuel Levy goes directly to the National Treasury, while the RAF Levy goes to the RAF, and is used to care for victims of car crashes.

"Currently these other costs total R7.06 for inland users, and R6.73 for coastal users, per litre of 93 unleaded petrol. Of this, a revised figure of R2.85 is allocated to the Fuel Levy, and R1.54 to RAF Levy."

This means that for every inland litre of petrol costing R12.32, R4.39 (35%) is allocated to different government levies. For every litre of coastal petrol costing R11.94, close to 37% is allocated to the levies.

Inland

Using this formula, filling a 50l tank with 93 unleaded petrol inland, will cost R616.00. Of this, R142.50 goes directly to the Fuel Levy with a further R77 going to the RAF Levy, giving a combined total of R219.50.

Coastal

Using this formula, filling a 50l tank with 93 unleaded petrol at the coast, will cost R597.00. Of this, R142.50 goes directly to the Fuel Levy with a further R77 going to the RAF Levy, giving a combined total of R219.50.

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