South Africans are losing almost R500 per tank to fuel taxes – here’s what you’re paying for

 ·24 May 2023

South Africans could be paying anywhere between R241 to R488 less per tank of fuel if taxes and levies were removed.

Taxes and levies on local fuels currently account for between R6.04 and R6.18 per litre sold in the country, depending on the grade and type.

This means 26% to 31% of the cost per tank of petrol goes to the government, depending on which fuel you choose, with the majority of the pump prices attributed to the basic fuel price (55%).

In May 2023, these tariffs are currently made up of the following:

  • Slate levy
  • IP Trace levy (diesel)
  • Pipeline levy (diesel)
  • General fuel levy (GFL)
  • Road accident fund levy (RAF)
  • Petroleum products levy (petrol)
  • Customs and excise duties

The two largest ones, which collectively account for over 99% of all taxes on fuel, are the General Fuel Levy (GFL) and Road Accident Fund (RAF) Levy – the former being allocated to National Treasury for the government to use in any manner it sees fit. At the same time, the latter may only be utilised for road accident claims paid out by the RAF.

The Slate Levy is delivered to the country’s Slate Account and pays for the cumulative over- and under-recoveries of fuel prices recorded during the month. For May, this levy was decreased by 17.54c/l and is now exactly 0.00c/l.

The IP levy pays for the “tracer dye” injected into illuminating paraffin to curtail the unlawful mixing of diesel and paraffin.

The table below details the values of all the various taxes accounted for in the fuel price in South Africa as of May 2023, according to data published by the DMRE.

Tax Petrol Diesel
Slate levy 0.00c/l 0.00c/l
IP Trace levy 0.00c/l 0.10c/l
Petroleum products/Pipeline levy 0.33c/l 0.33c/l
Customs and excise duties 4.00c/l 4.00c/l
Road accident fund levy (RAF) 218.00c/l 218.00c/l
General fuel levy (GFL) 396.00c/l 382.00c/l
Total 618.33c/l 604.43c/l

Considering the country’s consistently rising fuel costs in recent years, these levies have been scrutinised by motorists and industry participants as they are significant contributors to high pump prices.

Since January 2021, on average, petrol (93 and 95) has increased by 56.7% from R14.56/l to R22.82/l in May 2023, while diesel has risen by around 58.6% from R12.81/l to R20.32/l over the same period.

Compounding the rampant increases in fuel is the fact that the levies imposed on the fuel price have also increased annually – further burdening South African motorists while the government rakes in more revenue.

Since 2021, the GFL and RAF have increased by around 5% from 377c.00/l to 396.00c/l and 207.00c/l to 218.00c/l, respectively.

During the notable increases in the fuel price in 2021, the civil action group Outa called for a halt to the annual increase in the fuel levies.

“While we understand that we are a cash-strapped nation, we can no longer afford to burden society with higher taxes and levies applied to the price of fuel,” said Wayne Duvenage, Outa’s chief executive.

Duvenage also noted that the basket of levies and charges by the government has collectively increased by over 125% over the past decade – resulting in the collective cost of levies and surcharges of more than R10 per litre of petrol before the basic fuel price is added.

In May 2023, little has changed, and the cost of levies and surcharges are still over R10 per litre, as it currently sits at R10.38/l for 95 unleaded petrol.

Additionally, at R3.96, the GFL represents around 17% of every litre of petrol sold in South Africa. The RAF levy priced at R2.18 a litre represents around 11% of every litre of fuel sold.

According to the Automobile Association (AA), the two main levies will deliver around R138 billion in revenue to the government, with approximately R90 billion going to the GFL and the rest to the RAF.

The AA added that to mitigate rising fuel costs, the government must address better management and governance of the RAF and improve road safety to reduce demand on the RAF.

The association further noted that the misappropriation of funds and corruption are siphoning money away from the GFL, which could be used better if appropriately allocated and accounted for. Investments in alternative forms of public transport, and investments in improving Transnet, are also vital.

How much you could be saving at the pumps

To see what motorists can save at the pumps if taxes and levies were absent, we calculated the average tank size of five popular vehicles in each major segment and what it would cost to refuel it with and without the tariffs.

The fuel type used for the comparison was petrol 95, which in May is priced at R23.34 per litre at inland rates. Without taxes, petrol 95 would cost R17.16/l.

The savings are detailed in the table below.

Car type Avg. tank size Cost with taxes Cost without taxes Difference
Bakkie 79 litres R1,844 R1,355 R488
SUV 65 litres R1,517 R1,115 R402
MPV 56 litres R1,307 R961 R346
Sedan 52 litres R1,214 R892 R322
Crossover 47 litres R1,097 R806 R291
Hatchback 39 litres R910 R669 R241

Read: The rising cost of owning a car in South Africa – and how much it has changed

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