Petrol expected to increase by R4 per litre, but the fight is on

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The petrol price is set to go up by a gut-wrenching R4 per litre at the end of May 2022, pushing the petrol price to record-breaking heights.

This follows the latest data from the Central Energy Fund (CEF), which shows an increase of between R2.27 and R2.36/litre for petrol from next week. Adding to this, the government’s fuel tax relief officially comes to an end on 31 May 2021, which will see a further R1.50 increase.

Combined, these increases are expected to push the petrol price past the R25/litre level. As one can imagine, the impact of this will be felt by all. 

Pushing back, Organisation Undoing Tax Abuse (OUTA) has called on Minister of Finance Enoch Godongwana to extend the R1.50 per litre temporary reduction of the general fuel levy beyond 31 May.

“With this temporary fuel levy reduction of R1.50 intended to be reversed on 31 May, we have asked the Finance Minister to consider the extension of this reprieve, failing which the price of petrol and diesel will increase to over R25 per litre in the coming months,” stated OUTA CEO Wayne Duvenage.

Duvenage further highlighted that extending the reduction in the levy would affect National Treasury’s collections by roughly R2.8 billion a month. However, he noted that the economy would be significantly worse if petrol prices exceed the R25 per litre mark.

Moreover, the Democratic Alliance (DA) said that the price increase will drive food prices up even further, dealing a substantial blow to poorer households already struggling to put food on the table.

The DA’s John Steenhuisen said, “If we do not stop this fuel price increase, millions more people will fall into poverty, children will be stunted, people will starve, businesses will go bankrupt, jobs will be lost and mass riots could be sparked, such as in Sri Lanka last month in response to fuel price hikes there.”

He stressed the timing of this massive petrol price hike could not be worse, with South Africans battling under the weight of 46% unemployment, rolling power blackouts, flooding, drought and collapsing service delivery.

“Add to that the impending impact of global inflation, supply chain disruptions, and export blocks brought on by Russia’s invasion of Ukraine and it is clear we are racing headlong into a perfect storm,” he pointed out.

With all these factors, Steenhuisen continued by saying that South Africans simply could not afford to pay R25 per litre for fuel.

The DA further pointed out that petrol in Swaziland, Mozambique, Botswana, Tanzania, Namibia and Kenya is on average about R5 cheaper per litre, because their governments don’t tax it as much.

The DA proposes the following interventions:

  1. Scrap the General Fuel Levy
  2. Give exemptions to the RAF (Road Accident Fund) Levy
  3. De-regulate the Fuel Price

Furthermore, the DA has written a letter to both Minister of Mineral Resources and Energy, Gwede Mantashe, and Minister of Finance, Enoch Godongwana, urging them not to push the petrol prices even higher in the month of June.

With this in mind, the party is now calling on South Africans to co-sign the national letter, to ensure all South Africans have their voices heard.

To sign the letter, click here.

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