Budget 2021

Gordhan missed fuel levy chance to kill e-tolls - Outa

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Cape Town – How can the government increase the general fuel levy by 60c over two years, but can’t add another 9c to cover e-tolls, Outa chairperson Wayne Duvenage questioned on Wednesday.

Reacting to Finance Minister Pravin Gordhan’s Budget Speech in which he announced another 30c fuel levy hike, Duvenage said “it seems strange government claims it cannot place an additional 9 cents on the fuel levy to cover e-tolls as this will affect the poor, yet it has no problem increasing the general fuel levy by 60 cents over the past two years”.

Outa, which originally focused on its opposition to road agency Sanral’s e-toll system in Gauteng, has transformed into a body that challenges government on the misuse of taxpayers’ money.

Minister Gordhan goes after soft targets - not serious on corruption

“While the government's decision to increase fuel levy by 30 cents a litre was predictable during this time of low fuel prices, we are concerned these high fuel levies (now at 36% of the fuel price), will give rise to over R110bn in the general fuel levies (fuel levy and RAF), which is over 200% up on this revenue stream of a decade ago,” said Duvenage.

“The taxes applied to motorists and the transport industry will unfortunately be passed on to all citizens and will push up the cost of living.”

“Despite increasing the fuel levy, e-tolls remain a double taxation on Gauteng motorists and have become a farce and waste of taxpayers' money,” he said.

Duvenage was not happy there was not enough focus on corruption and mismanagement.  

“Government must work harder to get its house in order and show meaningful action to plug the holes in the bucket and deal with corruption,” he said.

“Government should start undoing the superficial taxes, which add no value and realise that we cannot tax ourselves into prosperity, but should rather be introducing significant changes to our regulatory and tax environment to meaningfully stimulate investment into South Africa.”

GRAPH: Timeline of the petrol price and fuel tax levy

Source: Outa

* Visit our special issue on Pravin Gordhan's 2016 Budget Speech.

WATCH:You cannot raise taxes while the bucket is leaking

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