Make no bones about it, the petrol price situation in South Africa is becoming traumatic. Nightmare fuel costs, and their knock-on effects, are threatening to put millions of citizens on the brink. But could these new proposals help ease the burden?
How South Africa could cut its petrol price by A THIRD
The DA believes it has an enactable plan that can relieve the pressure on households across the country. They are lobbying Finance Minister Enoch Godongwana, asking him to consider scrapping ALL TAXES AND LEVIES on the current petrol price.
The basic fuel price is related to the costs of purchasing petroleum products from international markets, and the costs related to shipping these products to South Africa. That makes up almost HALF of the total value.
Although this cost is largely influenced by the international price of crude oil and the Rand-to-Dollar exchange rate, other elements making up the petrol price are local in nature – they include wholesale margins and storage/distribution costs.
How much of our fuel money goes towards taxes?
However, the DA are targeting the ‘exorbitant’ taxes and levies, which account for a whopping 33% of the monthly petrol price. You can see a full breakdown of these costs here:
- Basic fuel price: 48%
- Taxes and levies: 33%
- Retail and wholesale margins: 14%
- Storage and distribution costs: 6%
What difference would cutting fuel taxes have on the petrol price?
Should the government heed these calls and do away with fuel taxes, a 33% decrease on the petrol price could not come at a better time. The latest projections for June bring nothing but misery to the motorists of Mzansi, who could soon be paying an EXTRA R4 for each litre.
By the start of next month, petrol AND diesel costs could top the R25-per-litre and R26-per-litre marks respectively. However, slashing one-third off this value would bring the prices down to a more manageable R17p/l and R18p/l.
These proposals could help ease cost of living crisis ‘significantly’
Kevin Mileham is the Shadow Energy Minister. He is encouraging every South Africa to co-sign this letter, which implores the government to go ahead with a long-lasting adjustment to the way fuel prices are calculated.
“The letter is directed to both the Ministers of Finance and Energy. With the fuel price set to increase with between R3.50 and R4 per litre in June, the price will soar to the highest it’s ever been, breaking the backs of all South Africans.”
“The DA implores Finance Minister Enoch Godongwana to scrap the 33% tax levy on fuel in order to keep the price within reason. The exorbitant 33% tax on fuel rests squarely in the hands of the ANC government.”
“South Africans simply cannot afford the fuel price increase. Our economy is still in tatters and there seems little hope and indication that government is trying to right the ship.”Kevin Mileham