Proposed provincial fuel levy has groups seeing red

File Image: IOL

File Image: IOL

Published Mar 26, 2018


Cash-strapped Western Cape road users could soon be paying a provincial fuel levy in addition to the existing national fuel levy, which has rights groups seeing red.

Finance MEC Ivan Meyer said consultants had already been appointed to investigate the viability of such a levy and a follow-up meeting would be held today for the government to receive an update.

In 2005 the provincial government, then under ANC rule, also proposed a levy of between 10c and 50c, and while it was approved by then finance minister Trevor Manuel, it was never implemented.

“The constitution allows us to make certain levies applicable on services and goods in the province. It can, however, not be done by us alone.

"It is done, in terms of the law, between the government and the national minister of finance,” Meyer said.

According to Meyer, the provincial treasury had appointed consultants to conduct a study on the viability of such a levy after the provincial cabinet approved it last year.

“That study will take into account the economic situation in the country at the moment and whether consumers would be able to afford it.

"One of the important issues is also to establish who will be taking in the money from the levy. We need this money to maintain and build roads in our province.”

Meyer said the impact on the economies of neighbouring provinces would also be taken into consideration.

“It would have to go through the parliamentary processes before this would be implemented. We have given ourselves between four and five years to establish it. At this stage, we are only investigating the possibility of such a levy. Nothing is final as yet,” Meyer said.

Wayne Duvenage, chairperson of Outa, said they were ready to fight the levy should it go ahead. “This is absolute nonsense. We cannot do this to our people. The government is crippling our consumers.

"They cannot use the excuse of wanting to maintain and build more roads. What happens to the monies they receive from the National Treasury? South Africans are overtaxed and we will not stop,” he said

Golden Arrow spokesperson Johan Dammert said: “An additional provincial fuel levy will impact our cost structures, which have already been affected

by increases in VAT and the national fuel levy. 

"In order to absorb the impact of these  increases we would have to critically assess all aspects of our operations, which would include, inter alia, streamlining overheads and reviewing revenue streams to ensure that the public transport service we provide remains affordable and sustainable.”

Carol Beerwinkel, ANC spokesperson on finance, said that although the ANC had proposed the levy years ago, the economic situation was much different.

“The total spend on consultants has increased by 29%, from R20 million to R26m, and the reason given is that you want to invest in a study for a fuel levy?

"Why would a province which is part of a unitary state where such policies are determined by national government want to even think about something like this?

"This is totally unacceptable. This Budget is supposed to be for the people, yet you grandstand about the implications of a VAT increase but in the background you plan this,” she said.

Cosatu Western Cape secretary Tony Ehrenreich said: “We will oppose this levy."

Cape Argus

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