/ 7 July 2006

FF Plus to question Manuel on Cape fuel levy

The FF Plus said on Thursday that it would ask Finance Minister Trevor Manuel to investigate the constitutionality of an intended provincial fuel levy.

The party’s minerals and energy spokesperson, Willie Spies, said in a statement the party would ask Manuel to investigate whether the planned fuel levy for the Western Cape would be justifiable in terms of Section 228(2) of the Constitution.

The relevant section provides that a provincial legislature may not exercise its competency to levy taxes in such a manner that it materially and unreasonably prejudices the national flow of goods, services, capital or labour.

”In practice a fuel levy of 50c in the Western Cape would mean that motorists travelling on the N1 from Cape Town would in future avoid filling up in Western Cape towns,” said Spies.

”For a vehicle with an 80 litre fuel tank, travelling on the N1, it would be up to R40 cheaper to fill up in Richmond in the Northern Cape rather than Beaufort West in the Western Cape.”

The Congress of South African Trade Unions on Wednesday condemned the proposed Western Cape fuel tax of between 10 and 50c a litre in addition to the current national levy.

The Inkatha Freedom Party also expressed concern at the proposed levy.

Democratic Alliance spokesperson on transport in the province Robin Carlisle said the Western Cape’s leading foreign currency earners — agricultural exports and international tourism — would be ”severely compromised” by the tax. – Sapa