In a bid to curb soaring petrol prices in South Africa, there is a proposal on the table: a targeted ‘special tax’ aimed at monopoly companies. Visvin Reddy, spokesperson for People Against Petrol and Paraffin Price Increase (PAPPI), suggests that this tax, among other measures, could bridge the fuel levy gap and potentially bring petrol prices down to approximately R10 per litre.
Reddy emphasized that the recent price hikes, which saw South African motorists paying nearly R26 per litre, are pushing the nation to a breaking point. He pointed out that these relentless increases, the third in succession, are not just burdensome for motorists but have far-reaching consequences, affecting food prices and the overall cost of living for all citizens.
South Africa’s fuel prices are significantly impacted by international factors such as crude oil prices and the rand/US dollar exchange rate. Reddy highlighted India’s approach, where the country diversified its oil sources, buying from non-OPEC nations like Russia and Iran, resulting in more stable fuel prices. He also criticized the country’s heavy reliance on imported supplies despite being a fuel-producing nation, stressing that local production, especially by entities like Sasol, could meet demands at a much lower cost than imports.
One significant proposal by PAPPI involves redirecting the revenue generated from the current R95 billion general fuel levy. Reddy suggests imposing a ‘special tax’ on the monopoly companies listed on the Johannesburg Stock Exchange, thereby relieving the burden on motorists and reducing petrol prices by a substantial 35%.
With these potential solutions in play, Reddy believes that the South African government has the means to rectify the situation. By addressing mismanagement and taking decisive action, there’s a real possibility of witnessing a significant drop in petrol prices, bringing much-needed relief to the people of South Africa.
Source: Bussinestech
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