DA proposes 50% cut to fuel levies to counter record price hikes

The Democratic Alliance (DA) says it wants to negotiate in good faith with its major partner in the Government of National Unity (GNU), the African National Congress (ANC), to consider its proposal to cut both the general fuel levy and the Road Accident Fund levies by 50% in an effort to reduce the impact of next month’s price increases.

With the country facing its highest-ever once-off hike to fuel prices owing to the US-Israel war on Iran, the party believes its proposal to plug the gap is reasonable.

READ: DA proposes cutting levies by 50% to cushion looming fuel price hike

On Wednesday, the party said it has already written to President Cyril Ramaphosa and Finance Minister Enoch Godongwana to consider the proposal, which would equate to a R3.00 saving per litre of fuel at the pumps.

The DA said as a partner in the GNU, it has the responsibility to come up with solutions to factors that impede economic growth and the living costs of South Africans.

The party’s Mark Burke believes his proposal to use the billions of rand in surpluses of the Compensation Fund and the Sector Education Training Authorities (SETAs) is a good starting point.

"The resources, if we can agree on where the funding should come from, the short-term resources are there to try and give a reduction to this fuel price increase. If we can avoid this before the full shock goes live, that would be an excellent outcome."

While Burke remains hopeful that the proposal can be worked into the Rates Bill of the current budget cycle, in which the Finance Minister last month raised the general fuel levy by 21 cents a litre, he says the party’s proposal does not mean it will reject the national budget tabled last month.

"The DA remains committed to ensuring this budget cycle works well. At the same time, we can’t be agnostic to global shocks affecting our economy and that’s why we are trying to intervene now," Burke stated.

The party believes further funds can also be found by intensifying ghost worker audits and state spending reviews to find more money to relieve South Africans at the fuel pumps.