ANC demands urgent fuel levy cuts as price hike deepens cost-of-living crisis

The African National Congress (ANC) has urged the National Treasury to swiftly reconsider fuel taxes and levies following a recent increase of approximately R3 per litre, which took effect on October 7. The ANC Study Group on Minerals and Petroleum Resources warned that the price hike would exacerbate transport and food costs, disproportionately impacting struggling households.

While international oil prices are a significant factor in South Africa's fuel costs, the study group argued that government has the power to intervene through existing taxes and levies. They emphasized that the fuel price issue is part of a broader cost-of-living crisis, as higher fuel prices would mean increased transportation expenses and higher food prices for South Africans.

The ANC called for the National Treasury to review the General Fuel Levy and Road Accident Fund Levy as an immediate measure to alleviate the burden on motorists, commuters, and low-income households that rely heavily on paraffin. The party acknowledged that international oil prices are beyond government control, but stressed that taxes and levies within the fuel price are under its jurisdiction.

The ANC noted that temporary relief measures are not new, citing a reduction in the General Fuel Levy in 2022 during a period of soaring international oil prices. However, they acknowledged that cutting levies would only offer short-term respite and would not tackle South Africa's vulnerability to global fuel-market fluctuations.

The shutdown of several domestic refineries in recent years has left the country heavily dependent on imported refined fuel, making it susceptible to global supply disruptions and increased shipping costs. The ANC urged the Central Energy Fund and the Department of Mineral and Petroleum Resources to expedite efforts to rebuild local refining capacity, partnering with the South African National Petroleum Company.

They emphasized that strengthening domestic refining would be a long-term solution to South Africa's reliance on fuel imports. The ANC pledged to maintain parliamentary oversight of the fuel-pricing regime and ensure a secure supply of liquid fuel, focusing on protecting working-class households from further financial strain.