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Daily Maverick
04-06-2025
- Business
- Daily Maverick
Mixed news at the pump: fuel levy rises while prices drop
The Western Cape High Court has dismissed the EFF's urgent bid to block a controversial fuel levy hike—just as fuel prices dip. From midnight, levies rise by 16c (petrol) and 15c (diesel), despite constitutional questions. It's a pump paradox: taxpayers pay more, but pump prices briefly fall. In a ruling handed down yesterday, Judge Nathan Erasmus found that the EFF's application lacked urgency and did not meet the legal threshold for interim relief. The court did not engage with the broader constitutional challenge itself, which the EFF had previously framed in its initial filing as a possible Part B of its legal strategy. A tax fight rooted in Budget 3.0 The levy increase was announced in Finance Minister Enoch Godongwana's revised Budget 3.0, tabled in May following the political fallout and eventual withdrawal of VAT hikes in earlier budget versions. Treasury estimates the fuel levy will raise about R4-billion in the 2025/26 fiscal year. The EFF has argued that the use of Section 48(1) of the Customs and Excise Act to implement the fuel levy increase amounts to an unconstitutional bypassing of Parliament. Section 77 of the Constitution requires that all new taxes be passed via a money Bill through the National Assembly. Arguments on constitutional compliance Representing the EFF, Advocate Mfesane Ka-Siboto told the court: 'The fact that this has happened before does not make it lawful. Past practice is not a substitute for constitutional compliance.' He described the move as a case of 'taxation without representation.' The Treasury, represented by Advocate Kameel Premhid, countered that Section 48(1) had long been used lawfully to adjust fuel levy schedules. He argued the measure was an administrative amendment within an existing framework, not the introduction of a new tax requiring legislative approval. What this means for you For consumers, the fuel levy increase translates into higher petrol and diesel prices at the pump, effective immediately. This could lead to broader knock-on effects on transport costs, food prices and inflation, particularly for lower-income households who spend a greater share of their income on fuel-linked expenses. Treasury maintains the hike is necessary to address fiscal gaps left by the abandoned VAT proposal. The fuel levy increase will be offset by a decrease in fuel prices – which also kicks in on Wednesday, 4 June. The Department of Minerals and Petroleum Resources (DMPR) announced the following price decreases yesterday: Petrol 93 (ULP & LRP): ⬇️5cents/litre. Petrol 95 (ULP & LRP): ⬇️5 cents/litre. Diesel (0.05% sulphur): ⬇️ 36.9 cents/litre. Diesel (0.005% sulphur): ⬇️36.9 cents/litre. Commenting on the changes, the DMPR noted that over the last month, there has been a decrease in the average Brent Crude oil price from US$66.40 to US$63.95, largely on the back of continued global trade uncertainty, Parliament distances itself from the damage Parliament, which was cited in the court papers, but not the target of any relief, issued a brief statement after the judgment: 'Although cited in the application, no relief was sought against Parliament. Parliament's position throughout the proceedings was to abide by the outcome of the court process. Accordingly, Parliament will comply with the court's ruling.' Oversight loophole or legal mechanism? In its legal representations, Treasury has argued that Section 48(6) of the Act ensures Parliamentary oversight by requiring the amended tariff to be tabled after the fact. The EFF, however, contends this form of post-implementation tabling falls short of the constitutional threshold for public finance legislation. EFF's Part B remains unclear In a short statement on X after the ruling, the EFF said: 'We are committed to fighting the fuel levy increase in court and in Parliament.' However, the party did not explicitly confirm that it would pursue the Part B constitutional review. Whether the EFF returns to court or not, the broader legal and political debate over fiscal authority, oversight and the democratic control of taxation is likely to persist. DM
Eyewitness News
03-06-2025
- Business
- Eyewitness News
WC High Court dimisses EFF's application to suspend fuel levy increase
CAPE TOWN - The fuel levy increase will come into effect at midnight after the Western Cape High Court dismissed the Economic Freedom Fighters (EFF)'s application to suspend it. The EFF had approached the court to suspend the increase before it comes into effect on Wednesday, and also review the minister's decision in his budget speech last month. But Minister Enoch Godongwana defended the decision, arguing in court that it was not another tax but rather a regulatory charge that the minister is empowered to implement. The EFF argued in court that Godongwana encroached Parliament's powers when he announced the levy increase. ALSO READ: EFF argues Godongwana has no powers to increase fuel levy The party says the minister also failed to introduce a money bill as required when imposing a tax, and this needs to be processed by Parliament. It says the minister instead relied on Section 48 of the Customs and Excise Act, which deals with duties on goods and customs, not general taxation. Godongwana's legal counsel, Adv Kameel Premhid, told a full bench that the increase is not a tax but a regulation. "Regulatory charges bring in money, so they might raise revenue. But that doesn't make it a tax, and just because a tax also raises revenue, the two are not the same thing." Godongwana's court victory means that from Wednesday, motorists will pay an extra 16 cents per litre for petrol and 15 cents more per litre for diesel.
IOL News
01-06-2025
- Business
- IOL News
EFF rejects fuel levy as an attack on the poor
EFF treasurer-general Omphile Maotwe has written to Finance Minister Enoch Godogwana rejecting the fuel levy. Image: Nhlanhla Phillips / Independent Newspapers By: Omphile Maotwe On 21 May 2025, the Minister of Finance tabled the third version of the 2025/26 national budget. Instead of solutions to South Africa's deepening fiscal and social crisis, the Minister delivered a cold and calculated betrayal. He proposed an increase to the general fuel levy by 16 cents per litre for petrol and 15 cents for diesel. True to what the Economic Freedom Fighters (EFF) and the country has come to expect from the GNU led administration, the proposal was dishonestly framed as a 'regulatory adjustment' instead of a tax increase. This levy aims to recover R1.3 billion in revenue after the courts struck down the unlawful VAT increase that featured in the initial budget proposal. The EFF is clear that the fuel levy is not a regulatory tweak but rather a tax hike that is being unlawfully imposed through the Customs and Excise Act, instead of through the Money Bill Act, as mandated by section 77 of the Constitution. We reject this proposal precisely because it is illegal and anti-poor. Our Constitution empowers only parliament to impose a national tax through the money bill. The Minister should therefore not be using administrative regulation to introduce a tax increase. The levy is a tax, even the government's own Budget Review refers to this fuel levy increase as part of 'fuel taxes on petrol and diesel.' Proceeding with it in this manner will only serve to defy the constitution, undermine Parliament's authority, and rob South Africans of their right to participate in fiscal decisions that directly affect their lives. The judiciary was clear in its handling of the initially proposed VAT increase by the Minister. A 2% VAT increase was proposed which was brought down to 0.5% but ultimately through the work of the EFF, it was recognised as a tax measure implemented outside of the law by the judiciary and subsequently suspended. Yet here we are again with a Minister who is determined to continue to undermine parliament and the courts. As the EFF we recognise this as arrogance, contempt and a blatant disregard of the law. The economic consequences of this illegal fuel levy will be devastating. While R1.3 billion may seem insignificant to Treasury, its impact on the working class and ordinary people of this country will be economically challenging. Fuel costs are a direct driver of inflation in transport, food, and essential services. For a worker commuting daily, a student relying on taxis, or a small trader transporting goods, this increase is not abstract. It is an attack on their survival. Our country is facing an economic crisis. That much is clear but as the EFF we will always be the voice that shields the poor from carrying an economic burden that results from poor governance and mismanagement. The crisis was not created by our unemployed youth in Tembisa or the grandmother in Giyani. It was not created by the street vendor in Umlazi or the taxi driver in Mthatha. The crisis was created by the ANC government through corruption, mismanagement, and a neoliberal austerity agenda that punishes the poor and protects the rich. The EFF has taken decisive action regarding the fuel levy and on 26 May 2025, we wrote to the Speaker of the National Assembly and the Chairperson of the Standing Committee on Finance, demanding immediate parliamentary intervention. We called for the Minister of Finance to withdraw the proposed levy because it must be introduced through the Money Bill Act. We further urged the Finance Committee to place this matter on its agenda, summon the Minister to account, and reaffirm Parliament's constitutional authority over all revenue measures. This matter deserves urgent attention because if the levy is allowed to proceed in its illegal state, we run the risk of further legal challenges and collapsing the fiscal framework. No legitimate parliament would endorse a budget that is tainted by unlawful taxation. What is most alarming is that if the 2025/26 Budget is not adopted by 31 July as required by the Constitution, the government could face an administrative shutdown under section 21. The EFF however is not opposed to raising revenue legitimately. We support progressive taxation that will fund development, create much-needed jobs, and render services to our people. But taxation must be lawful, fair, and aimed at those with the most. The government needs to urgently impose a wealth tax, close corporate tax loopholes, and end illicit financial flows. Revenue can also be raised by scrapping the bailouts to failing state-owned entities but the EFF is against putting further strain on the poor and working class. Imposing a fuel levy is a political decision and must be recognised as such. The EFF will not be silenced or intimidated by political bullies who continue to disregard the law, due process and undermine parliament and our constitution. We stand ready to fight against the injustices that will emanate from this tax increase that is disguised as an adjustment. We will fight against it in the corridors of parliament, in the confines of the courtrooms, and ultimately on the streets and on the picket lines. We will challenge this decision because we recognise it for exactly what it is, a bid to squeeze the poor and continue to cushion the rich and politically connected. Parliament should not allow the fuel levy to proceed as it threatens to render our institutions irrelevant. The people of South Africa did not vote for a government that will govern without notice, and parliament should be at the forefront of protecting the people who have entrusted us to lead and represent them. We call on all progressive forces to demand accountability, consultation, and for parliament to reclaim its power. The time has come for parliament to decide if it will stand with the people of South Africa or bow down to an unaccountable executive. The EFF stands with the people. * Omphile Maotwe is the Treasurer General of the Economic Freedom Fighters and a Member of Parliament ** The views expressed do not necessarily reflect the views of IOL or Independent Media
Eyewitness News
30-05-2025
- Business
- Eyewitness News
Treasury defends fuel levy increase
CAPE TOWN - The Treasury has defended an increase in the fuel levy, saying if it doesn't raise it in line with inflation, it would become worthless over time. The fuel levy has been left unchanged for three years to mitigate the impact of high oil prices at the time it was frozen. The Economic Freedom Fighters (EFF) is going to court next week to challenge the legality of imposing an increase as part of the national budget, saying that the finance minister had failed to issue a government notice to this effect, nor had he introduced a bill in Parliament. The price of petrol will increase by at least 16 cents per litre on Wednesday. ALSO READ: • Ntshavheni says EFF free to challenge national budget in court • EFF accuses finmin of 'undermining' Parly in court papers seeking to stop fuel levy hike • MPs say impact of fuel levy increase will be 'far worse' than VAT hike • EFF accuses Treasury of replacing VAT increase with fuel levy hike • Automobile Association slams new fuel levy hike The Treasury said that increasing the value-added tax (VAT) rate could not be equated with raising the fuel levy. Responding to public submissions on the budget in Parliament on Friday, Treasury's head of tax policy, Chris Axelson, said that the fuel levy was the country's fourth-largest revenue source, contributing about five percent to total tax revenue. "This is a specific tax, a cents per litre, so these kinds of specific tax, which is the same as excise duties, they need to be adjusted by inflation, otherwise the real value of that tax will go down over time." Axelson said that by not adjusting the fuel levy, Treasury would lose about R3.5 billion in revenue. "The vast majority of the tax revenue increase is all on the personal income tax side. Around R16.7 billion of the R18 billion in increases is all on personal income tax." While the finance minister is empowered through the Customs and Excise Act to implement an interim fuel levy adjustment by a notice in the gazette, Parliament can intervene to change the duration before it's formalised in the taxation act.
The Star
25-05-2025
- The Star
Police seize counterfeit goods worth over R20 million in Bruma operation
The South African Police Service (SAPS) has seized counterfeit goods valued at more than R20 million during a high-impact operation in Bruma, east of Johannesburg. Police spokesperson Lieutenant Colonel Amanda van Wyk said the large-scale operation, involving units such as the Hawks, Crime Intelligence, SARS, Customs, Home Affairs, and private security, led to the arrest of 35 suspects connected to counterfeit goods. 'The operation resulted in the arrest of 35 individuals. One suspect was arrested for contravening the Counterfeit Goods Act, while 34 foreign nationals were arrested for contravening the Immigration Act.' Van Wyk added that the operation confiscated over 24,000 counterfeit products, including imitation branded clothing. 'Acting on intelligence gathered, the team executed search and seizure warrants following the Customs and Excise Act and the Counterfeit Goods Act. The operation led to the seizure of over 24,000 counterfeit items, including branded clothing, footwear, handbags, perfumes, jewellery, and cellphone accessories,' she said. Van Wyk stressed that SAPS continues to fight tirelessly against the illegal trade in counterfeit goods to protect consumers, back legitimate businesses, and preserve the integrity of the country's economy. Last month, police seized counterfeit goods worth over R50 million in nationwide operations, including illicit cigarettes valued at R4.5 million during a takedown. Van Wyk said the takedown operation targeted shops in Pretoria Central, Centurion and Brits in the North West. "More than 2,000 items were seized that including high-end counterfeit clothing, shoes, handbags, caps, watches, sunglasses, and belts as well as toys," said van Wyk. Three Bangladeshi nationals were also arrested for contravening the Immigration Act during the operations. The Star [email protected]
