Fuel levy vs e-tolls
Economist Mike Schussler says that while a fuel levy may end up being cheaper for commuters than the proposed e-toll system, the former idea has challenges of its own.
Opposition to the South African National Roads Agency’s (Sanral) e-toll system have argued that imposing a fuel levy would be a better option for all.
Schussler, who is founder and owner of Economists.co.za, told BusinessTech: “The problem for me with the fuel levy is that everyone pays even if they do not use the highway.”
“So, say we charge the whole country, that would be about 13 cents then. If only Gauteng petrol was charged for, it would be more – but remember not everyone travels the highway.”
Aside from the “unfairness” of a fuel levy, Schussler also points out that the biggest problem with a fuel levy is where the funds end up.
“Apart from the road accident fund, UIF and TV licence money (and the plastic bag levy too), all other money goes into central coffers,” Schussler said. “Here it may not end up going to Sanral.”
- Mike Schussler
According to Schussler, there may be another viable option for paying for the Gauteng highways.
“If we agree we need roads – we need either a dedicated Road Fund – via, say, fuel and municipal taxes (most roads are in towns etc.) – or toll roads,” Schussler said.
“I believe that a dedicated road and public transport fund may be good in the longer term – but then all roads must be built – by say, a Sanral or similar efficient operator – and public transport must be far, far better coordinated.”
As part of an e-toll marketing campaign, Sanral has run several adverts in South African newspapers, stating “the facts” about the highly controversial tolling system it plans to launch on Gauteng’s highways.
Sanral says that using a fuel levy as an alternative is not sustainable, as cars are becoming more fuel efficient, meaning over time fuel levies will produce declining revenues.
Sanral Fuel Levy Ad
Wayne Duvenage, who heads up Opposition To Urban Tolling Alliance (Outa) which is currently embroiled in a legal battle to prevent the project from going ahead in Gauteng, says Sanral’s claims that the fuel levy is unsustainable is “shocking”.
“What they are implying is that if society had to use the fuel levy as a mechanism to pay for infrastructure, and cars get more efficient, it becomes more difficult to collect the required fees,” he said.
“This is futile because the fuel levy has increased substantively every year – and at the current levels of R2.13 per litre, gives rise to R44 billion per annum.”
According to the Outa head, in 2006, when the GFIP plan was mooted, had they increased the fuel levy by R0.09c per litre back then, road users would have raised the capital cost of the road itself of R17 billion, “if you add in the R5.7 billion Treasury put into the project last year,” Duvenage argued.
“We have simply wasted all this time for nothing, and their (Sanral’s) argument remains even weaker when you take this example into account.”
“I can understand the reasoning of Treasury and Outa, but I think even a fuel tax has an unfairness built in, as some will pay for others,” Schussler said.
“If all roads where included, that would be different,” he said.
More on Sanral and e-tolls
Sanral insulting your intelligence: Outa
No e-tolls in a DA-governed Gauteng
Sanral dismisses DA e-toll claims
R381 million to track down e-toll transgressors?
Sanral’s e-toll advertising budget soars
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