AA warns fuel levy hike will hit consumers hard

On Wednesday, Finance Minister Enoch Godongwana announced that the general fuel levy will increase by 16c per litre for petrol and 15c for diesel.

It is the first fuel levy rise in three years.

Godongwana told Parliament during the tabling of Budget 3.0 that despite the increase, it still would not be enough to close the country’s fiscal gap over the medium term.

The AA’s Eleanor Mavimbela said that while they understand the government’s fiscal pressures, the impact of the levy hike will hit consumers hard, as South Africans are already grappling with high food prices and more.

"Elevated interest rates, increased electricity tariffs, and persistently high unemployment. Fuel is a critical input cost across all sectors of the economy," said Mavimbela.

 READ: Godongwana delivers Budget 3.0 without VAT hike

"Any increase inevitably dries up transport and operational costs, further intensifying inflation.

"Lower income households, which spend a greater share of their income on transport will be disproportionately affected by this rise."

Mavimbela said there need to be transparency on how these funds are allocated and used.

“We stand ready to engage with government and all stakeholders to develop sustainable, transparent, and equitable solutions that support both economic growth and the citizens who drive it.”

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