The increase at midnight on Tuesday of the retail price of petrol and diesel will further dampen economic growth in South Africa, says official opposition energy spokesperson Ian Davidson.
In a statement Davidson said: “While the Democratic Alliance recognises the effect of global production on the price of our fuel, we reiterate our call for the deregulation and restructuring of the liquid fuels industry to ensure greater competition and efficiency.
“All taxes and duties that currently make up almost 40% of the fuel price should be reviewed in order to reduce the burden on South African taxpayers.
“The increase in world demand for fuel and the recent OPEC supply cuts have caused an alarming increase in oil prices that may turn into an oil crisis. The government’s approach to deal with this situation should be to cut taxes to bring down the consumer price of fuel, not raise them.”
Davidson said countries such as the United Kingdom and Finland “have historically provided tax relief in the face of such increases. Given that our tax on fuel is already relatively high compared to other developing countries, our government’s approach appears counter-intuitive.”
He pointed out that during the Budget speech in February, Minister of Finance Trevor Manuel proclaimed that the increase in the fuel levy that drove this price increase would raise an “additional R909-million over the next year”.
“Given that 11 times this amount could be have been saved by cancelling the third tranche of the arms deal, perhaps the government should rethink its priorities and stop dragging our economy down by increasing taxation on productive South Africans.”
The retail price of 93 Octane Leaded, 93 Octane Unleaded, 95 Unleaded and 97 Octane leaded and Unleaded petrol is to increase by 22 cents a litre on April 7 after increasing by nine cents a litre on March 3 and 30 cents a litre on February 4, the Department of Mineral and Energy said earlier on Tuesday. — I-Net Bridge