Government extends fuel levy cut to June 2
Motorists will continue to benefit from fuel levy relief until June 2, as Treasury and the department respond to rising global oil prices.
The temporary reduction in the general fuel levy, introduced to cushion motorists against rising fuel prices, has been extended to June, according to the South African Government News Agency.
In a joint statement, the National Treasury and the Department of Mineral and Petroleum Resources said the extension aims to provide further relief and limit the impact of rising fuel costs on inflation and economic growth.
The measure, initially announced on March 31, reduced the general fuel levy by R3 per litre for petrol from April 1 to May 5.
It has now been extended until June 2.
Government said the decision follows continued pressure on global oil prices linked to the ongoing conflict in the Middle East, which has contributed to rising domestic fuel costs.
As part of the extension, the general fuel levy for petrol will remain at R1.10 per litre until June 2. For diesel, relief has been increased by 93 cents to R3.93 per litre, effectively reducing the levy to zero over the same period.
From June 3 to June 30, the level of relief will be reduced as part of a phased approach to ending the intervention.
During this period, the levy reduction will be lowered to R1.50 per litre for petrol and R1.96 per litre for diesel.
This will see the general fuel levy increase to R2.60 per litre for petrol and R1.97 per litre for diesel.
From July 1, the fuel levy will return to its full rates of R4.10 per litre for petrol and R3.93 per litre for diesel.
Government estimates the cost of the relief measures from April to June at R17.2b in foregone tax revenue. However, it said the intervention is designed to remain fiscally neutral and will be funded through higher-than-expected tax revenue and underspending elsewhere.
Meanwhile, the Department of Mineral and Petroleum Resources has initiated a review of the fuel price calculation formula, which will determine how prices are regulated in future.
The department added that adjustments to the slate levy, used to balance under-recoveries by fuel importers, will continue to be applied where necessary.
