After years of moaning from motorists that taxes make up too much of the petrol price, President Cyril Ramaphosa finally relented and promised that the government would review levies that account for 46% of the cost of filling up a tank.
Only, there’s a snag: there’s little, if any, room to budge.
The government can only realistically adjust two of the three levies contributing to the fuel price: the general fuel levy (GFL) at R3.85 per litre and the Road Accident Fund (RAF) levy at R2.18 per litre. The other-levies component adds up to R5.21 per litre, while the basic fuel price, determined by the rand and oil prices, stands at R13.29 per litre.
For every rand the government reduces from the GFL and the RAF, “they will lose around R23bn in revenue”, which is a significant challenge given “our current economic pressures”, Wayne Duvenage, CEO of the Organisation Undoing Tax Abuse (Outa), a lobby group, says in an emailed response.
The GFL and RAF levies haven’t increased for three years, easing transport costs slightly, but Duvenage is doubtful that the government would find other areas to cut, aside from improving the management of the RAF or funding it differently.

The Automobile Association (AA) has welcomed the government’s willingness to examine the levies, something it has long advocated for. If the review concludes that the current setup is the best solution, at least South Africans will know that it was thoroughly considered, says AA spokesperson Layton Beard.
The AA also points out that the RAF is poorly managed and financially strained, failing to deliver value for the money it receives from taxpayers. Beard adds that the AA is ready to participate in any forum reviewing the fuel levies.
A call for transparency
Reducing the general levy will be tough; it’s expected to generate about 5% of the government’s tax revenue for the 2024 financial year, or roughly R93.4bn. Ironically, this revenue is bolstered by more goods being transported by trucks due to the country’s inefficient rail services, further degrading roads already riddled with potholes, poorly maintained lane markings and inadequate drainage.
Given that the general levy feeds into the broader tax pool and isn’t earmarked for road maintenance, new highways or public transport investments, Beard calls for better allocation, transparency and oversight of these funds.
Finance minister Enoch Godongwana and the government of national unity should be cautious about reducing this crucial revenue stream unless it can be compensated for without imposing additional burdens on consumers and businesses.
The answer always boils down to growing the economy; as GDP expands, the government’s income increases and its debt ratios will naturally improve. Better governance, of course, reduces the leakage of funds.
Long-time critics of the current system finally have their time to contribute, so some fresh ideas would be invaluable in navigating this complex issue. We could all do with a little relief at the pumps.
Top image: Collage. Currency.