{"id":878805,"date":"2026-10-07T16:46:43","date_gmt":"2026-10-07T14:46:43","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=878805"},"modified":"2026-10-07T16:46:45","modified_gmt":"2026-10-07T14:46:45","slug":"new-mandatory-tax-for-anyone-renewing-their-car-licence-discs-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/878805\/new-mandatory-tax-for-anyone-renewing-their-car-licence-discs-in-south-africa\/","title":{"rendered":"New mandatory tax for anyone renewing their car licence discs in South Africa"},"content":{"rendered":"\n

The Road Accident Fund (RAF) is looking for new revenue sources after five years with no change to the levy attached to petrol prices, which has reduced its income.<\/p>\n\n\n\n

The fund is now proposing a significant hike in the Road Accident Fund Levy to R3.00 per litre, while exploring additional ways to charge motorists, including additional vehicle and driving licence renewal fees.<\/p>\n\n\n\n

In the RAF’s annual report for 2025\/26, the fund noted that its current funding model has been affected by reduced fuel volumes and levies remaining static.<\/p>\n\n\n\n

The National Treasury increased the RAF levy for the first time in five years in 2026, hiking the tax by 7 cents per litre to R2.25, from R2.18 before.<\/p>\n\n\n\n

The levy had been frozen at R2.18 per litre since 2021\/22.<\/p>\n\n\n\n

“The RAF has not received an increase in the fuel levy over the past five years. During the same period, inflation continued to erode the Fund\u2019s real income,” it said.<\/p>\n\n\n\n

The total revenue for the RAF decreased by 5% to R48.1 billion in 2025\/26, compared with the previous period (2024\/25: R50.8 billion). Net fuel levies accounted for 99.40% of the total revenue.<\/p>\n\n\n\n

However, while the 7-cent-per-litre hike to the levy in 2026\/27 was welcomed, the RAF said it was not enough.<\/p>\n\n\n\n

Notably, even as the tax went up, collections were severely undercut by lower fuel sales volumes due to fuel price hikes driven by the Middle Eastern war and other inflationary pressures.<\/p>\n\n\n\n

This has put this historically insolvent fund under even more pressure to “fund an unlimited claims trajectory”. <\/p>\n\n\n\n

To address this, the RAF’s management is proposing increasing the fuel levy to R3.00 per litre to help stabilise its solvency position.<\/p>\n\n\n\n

It said that it has made a proposal to the National Treasury through the Medium Term Expenditure Framework for a stronger levy of “up to R3.00 per litre”, in addition to Treasury capital support.<\/p>\n\n\n\n

New charges on vehicle licence renewals<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

In an attempt to mitigate the fund’s going concern risk, the RAF said it has also implemented several other measures, including investigating additional revenue sources.<\/p>\n\n\n\n

A key investigation here is the possibility of introducing the RAF Levy to more transactions.<\/strong><\/p>\n\n\n\n

This would include implementing the levy on all foreign-registered motor vehicles entering South Africa and attaching it to motor vehicle registration and\/or licence renewals.<\/p>\n\n\n\n

The RAF said the latter would specifically look to cover the rise of electric and Hybrid electric vehicles in South Africa.<\/p>\n\n\n\n

Since electric vehicles do not consume fuel, they do not pay the current RAF levy and therefore do not contribute to the RAF, despite being granted the same benefits.<\/p>\n\n\n\n

A tax on licence renewals has been under consideration for some time, with Minister of Transport Barbara Creecy confirming in July<\/strong><\/a> that it was being investigated.<\/p>\n\n\n\n

Creecy noted at the time that the government is working on a new funding model for the RAF, adding that there was merit in a separate mandatory RAF fee.<\/p>\n\n\n\n

This would be tied to vehicle registrations and licence disc renewals, she said.<\/p>\n\n\n\n

The Department of Transport argues that a new vehicle-linked transitional levy is needed to capture revenue from all road users.<\/p>\n","protected":false},"excerpt":{"rendered":"

The RAF is investigating new revenue sources after collections from petrol taxes have slowed down.<\/p>\n","protected":false},"author":10,"featured_media":863195,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"posted","_sma_x_autopost_error":"","_sma_x_post_id":"2107845167013052630","_sma_facebook_post_id":"191437357620492_2229480437872355","_sma_instagram_post_id":"18383179021238884","_sma_x_attempts":1,"footnotes":""},"categories":[23],"tags":[8452,9818,11627],"class_list":["post-878805","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-barbara-creecy","tag-raf","tag-road-accident-fund"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/878805","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=878805"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/878805\/revisions"}],"predecessor-version":[{"id":878812,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/878805\/revisions\/878812"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/863195"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=878805"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=878805"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=878805"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}