The Organisation Undoing Tax Abuse (OUTA) has pointed the finger to the government’s maladministration and mismanagement as the reason behind April’s petrol price increase.
The organisation’s portfolio manager for energy, Ronald Chauke, revealed that we would be paying much less at the pumps if it were not for the South African government.
Exorbitant fuel levy fees to blame for high petrol price
Of course, the other, most crucial, reason, why the petrol prices keep going up, is linked to the rand’s performance in the markets, which is at a slump at the moment.
However, according to the civic organisation, there is still no reason why South Africans are paying more than R15 for a litre of petrol.
Chauke stated that it is egregious that fuel levy fees account for 23% of the price of fuel. This excludes the carbon tax fees that will be included from June, prompting another foreseeable fuel hike in two months.
“The extra revenue from the general fuel levy alone compared to a decade ago would pay for another Gauteng Freeway Improvement Project, but motorists are not feeling the benefits of the ever-increasing taxes,” Chauke said.
Fuel levy fees: a ten-year comparison
OUTA revealed that In the 2018/2019 financial year, National Treasury accrued R75-billion in revenue from fuel levy fees.
These, however, have not been allocated towards road improvement projects — which is its intended purpose.
Instead, the money is included in the general revenue pool to service the debts of the mismanagement and maladministration the government undertakes.
“April is a difficult month for consumers. Eskom’s electricity prices to direct customers went up on Monday while the monthly increase in fuel prices takes effect on Wednesday…
“OUTA believes that Treasury has pushed the general fuel levy too far over the past decade, from R1.21/l at the start of 2008 to this month’s R3.52/l,” he added.
In the last ten years, the fuel levy has risen by R2,31. The levy has brought in R50-billion more in 2019, as compared to R25-billion in 2009.
Yet, the civic organisation claims, Treasury is struggling to fund the R20-billion Gauteng Freeway Improvement Project.
“OUTA believes there is a need for transparency in the use and allocations of the fuel levy,” Chauke said.