President Ramaphosa considers measures over fuel prices in South Africa — TimesLIVE
South African President Cyril Ramaphosa said the National Treasury is considering possible steps to reduce pressure on the cost of living caused by the sharp rise in fuel prices. Support options may be announced in Finance Minister Enoch Godongwana’s medium-term budget statement on Wednesday, TimesLIVE reports.
Record petrol prices
Following the latest monthly adjustment, the price of petrol in Gauteng province reached a record 30.95 rand per litre. Since the jump in domestic prices caused by constrained global oil supplies amid the conflict between the United States and Iran, petrol has become nearly 50% more expensive, while diesel fuel has risen by 72%.
Ramaphosa noted that rising fuel costs are a global problem and that the government is seriously considering the necessary action. At the same time, he warned that large-scale subsidies or a reduction in the general fuel levy would mean a loss of funds for other state programmes and public services.
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Cost of tax relief
According to the president, during the previous price spike the government allocated about 24 billion rand to the subsidy mechanism. Before the first sharp increase in April, the Treasury reduced the general fuel levy by 3 rand per litre to partially offset the impact of rising prices.
At the time, the Treasury said the decision would result in 17.2 billion rand in lost revenue, which is used, among other things, for healthcare, education and policing. Ramaphosa added that new measures require a budget assessment, as they could affect the country’s reserves and fiscal position.
Bank of America forecasts that South Africa’s revenue in the 2026/27 financial year will exceed February expectations by 70 billion rand, mainly due to higher corporate tax receipts from the gold and precious metals sectors. Sanlam Investments economist Patrick Buthelezi said that a three-year wage agreement, controls on the number of civil servants and a voluntary early retirement programme should help contain the wage bill. At the same time, he pointed to pressure to reduce public debt and the risk of falling commodity prices, which could reduce revenue.
