• News
  • Sport
  • TV
  • Radio
  • Education
  • TV Licences
  • Contact Us
No Result
View All Result
  • SOUTH AFRICA
  • POLITICS
  • BUSINESS
  • SPORT
  • AFRICA
  • WORLD
  • SCI-TECH
  • LIFESTYLE
  • FEATURES
  • OPINION
Home Business

Mboweni likely to increase fuel, RAF levies

19 February 2019, 9:57 PM  |
Amina Accram Amina Accram |  @SABCNews
Cars at a fueling station

Minister of Finance Tito Mboweni is expected to increase the fuel levy when he delivers the Budget Speech on Wednesday.

Cars at a fueling station

Image: SABC News

Minister of Finance Tito Mboweni is expected to increase the fuel levy when he delivers the Budget Speech on Wednesday.

Consumers should brace for tougher times ahead. Finance Minister Tito Mboweni is likely to announce levy increases to the fuel and Road Accident Fund (RAF) in his 2019 Budget Speech on Wednesday.

In 2018, Mboweni warned that the Road Accident Fund liability would increase. He said the 30-cents-a-litre increase was not be enough.

Economists want the minister to put the fuel and Road Accident Fund increases on par with inflation.

In his Medium-Term Budget, Mboweni said he expected the Road Accident Fund to increase from R206 billion to almost R400 billion in 2021/22.

In 2018, the petrol price hit an all-time high reaching R17 a litre. Government had to intervene in September to cushion the impact of fuel hikes.

The Rand has remained volatile since the beginning of 2018 while Brent crude oil prices have continued to escalate.

Depending on what the markets will do by April, the fuel and road accident levy increases will in the long term have a negative impact.

Automobile Association Spokesperson Layton Beard says this is worrying.

“In essence, those two levies comprise R5,30 of every litre of fuel that is sold in South Africa. So, if you’re looking at a litre of petrol around, as an example for R15,30, essentially R5,30 of that is being paid towards taxes. History is pointing at the fact that the Finance Minister, when he gives his Budget Speech later this week, will in fact announce increases to those two levies. He announces them in February and they come into play in April. The question now that will have to be answered by the minister is, ‘Exactly how much those levies are going to be increased by?’ ”

Senior Tax Consultant at Mazars, Tertius Troost says, “Tito Mboweni actually stated that we might see significant increases in the fuel levy in order to look at the Road Accident Fund and the liability, that is expected to almost double in the next three years.”

Economists want the levy increase to be at par with inflation.

“But it’s unlikely going to be that low and it’s more likely that the increases will be more than that. But again, it’s speculation to say by how much. But we have to wait and see,” says Troost.

Over the past 10 years, taxes on fuel increased by more than 200% while taxes on the Road Accident Fund have increased by over 300%. Beard says the increases are necessary for government despite the negative ripple effect it has on consumers and businesses

“Obviously, the ripple effect of a higher fuel price is that the input costs will increase by producers in agricultural sector, by small businesses and because those input costs are increasing they will have to be recovered somehow and the way those sectors recoup those increases is obviously by passing them on to consumers. And so, it is in a sense a little bit of a double whammy in that you are paying more for fuel on one hand that has been brought about by these increase in the basic fuel price and by the increase to the levies, but you are also paying more because prices of commodities and services are also becoming more expensive.”

The Road Accident Fund levy is a portion of the fuel price that goes to the Road Accident Fund, which benefits victims of car crashes.

On the other hand, the general fuel levy is a fund that is collected by government and is an indirect tax.

Money collected through this can be used for anything that government sees fit. For example, it can be used to buy school books, to build clinics, roads, etc.

Watch video below for more on the story:


Share article
Tags: ParliamentLayton BeardBudget SpeechFuelRoad Accident FundTertius TroostBudget 2019Western Cape
Previous Post

Jobs, jobs, more jobs: Citizens’ expectations of Mboweni’s budget

Next Post

Trump to launch global campaign to end criminalisation of homosexuality

Related Posts

A candle is used during load shedding in South Africa.

Eskom ramps up rolling blackouts to Stage 4 until further notice

29 January 2023, 8:37 PM
A ward in a hospital.

Budget not sufficient to hire more doctors: Department of Health

29 January 2023, 4:25 PM
Workers harvest sugarcane in a field.

Rolling blackouts could cost cane farmers millions

29 January 2023, 9:30 AM
The logo of MTN is pictured in Abuja, Nigeria, September 11, 2018.

Naledi Pandor calls MTN, Ghana to resolve $773 mln tax dispute

28 January 2023, 3:29 PM
Workers disgruntled over low wages and changes to terms and conditions of employment, go on strike outside a Massmart Holdings owned Makro store in Johannesburg, South Africa, November 19, 2021.

Contingency plans in place at Makro stores amid wage strike

28 January 2023, 11:42 AM
[File photo] A worker harvests grapes at the Domaine Pinson vineyard in Chablis, France, September 21, 2021.

Grape farmers face more challenges amid rolling blackouts

28 January 2023, 8:21 AM
Next Post
US President Donald Trump

Trump to launch global campaign to end criminalisation of homosexuality

Most Viewed

  • 24hrs
  • Week
  • Month
  • Gas leak shut, isolated in Pretoria North
  • Scorcher predicted in Northern Cape for two weeks
  • Limpopo man arrested after discovery of his wife’s body in water-filled pit toilet
  • Residents shut down Komani over power woes
  • ANC slams DA’s march to Luthuli House
  • Parts of the Northern Cape to be exempted from rolling blackouts
  • VIDEO | St Benedict College’s Matric learner gets 11 distinctions
  • Limpopo matriculant from child-headed household attains diploma pass
  • Female circumcision practice thriving in Eastern Cape
  • Premier denies claims that KZN government spent millions on Mampintsha’s funeral
  • Cele reacts to arrest of police mom charged with rape of her child
  • Malema threatens nationwide shutdown over power crisis, demands Ramaphosa resign
  • Sanco KZN conference legitimacy challenged
  • GRAPHIC CONTENT WARNING: Psychiatric patient in Limpopo found dead
  • Alleged paedophile Gerhard Ackerman re-arrested

LATEST

A gavel and a block is pictured on the judge's bench in this illustration picture.
  • South Africa

Pastor Zondo rape trial back in court on Monday


The high levels of loadshedding have sharply divided the country along party-political lines.
  • Politics

ANC aims to end rolling blackouts as EFF announces plans to bring country to a standstill


Gavel seen in a courtroom
  • South Africa

Several rapists sentenced in Northern Cape


A candle is used during load shedding in South Africa.
  • Business

Eskom ramps up rolling blackouts to Stage 4 until further notice


Fikile Mbalula
  • Politics

ANC aims to end rolling blackouts by end of the year


Chairperson of the African National Congress, Gwede Mantashe.
  • Politics

EFF seeks private prosecution of Mantashe regarding security upgrades at his properties


Weather

  • About the SABC
  • Contact Us
  • Jobs
  • Advertise
  • Disclaimer
  • Site Map

SABC © 2022

No Result
View All Result
  • SOUTH AFRICA
  • POLITICS
  • BUSINESS
  • SPORT
  • AFRICA
  • WORLD
  • SCI-TECH
  • LIFESTYLE
  • FEATURES
  • OPINION

© 2022

Previous Tito Mboweni Jobs, jobs, more jobs: Citizens’ expectations of Mboweni’s budget
Next US President Donald Trump Trump to launch global campaign to end criminalisation of homosexuality