R300 million car licence problem for South Africa

The Road Traffic Management Corporation (RTMC) is facing collection issues as municipalities fail to pay the authority on time or at all. This is according to transport minister Fikile Mbalula who was responding in a recent written parliamentary Q&A.

In terms of the Road Traffic Management Corporation (RTMC) Act, local registering authorities (licensing centres) must pay the corporation a transaction fee for each motorist it processes. This is subsequently passed on to the motorists and added to the annual vehicle licence fee.

This fee is separate from the actual licence fee, with the additional fee effectively added to the renewal costs for all motor vehicle licenses across the country. As of 2021, the additional fee for each vehicle licence was R72. While a R72 fee may seem minor, the tariff has steadily climbed since it was first introduced at R30 in 2007.

However, data provided by Mbalula shows that these fees – which total in the hundreds of millions of rands – are often not handed over to the RTMC in full, with the authority facing an under-collection of close to R100 million over the last three years.

“It is important to note that transaction fees due to the RTMC is exclusively applicable to vehicle licence disc renewals. On a continuous basis, the RTMC shows an under-collection on transaction fees. Provinces have indicated that this is due to municipalities not paying over all the funds to them and in turn the province not paying the full amount to the corporation,” Mbalula said.

“Even though the recovery rate of the transaction fees have improved, there are still provinces that maintain an unremitting growth in the amount owed to the corporation.”

Read: South Africa can’t cope with the number of cars on its roads: minister

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R300 million car licence problem for South Africa