Photo by: Duane Daws
Using the fuel levy to replace Gauteng’s e-toll system will cause services to the poor to suffer, Parliament’s transport committee said on Tuesday.
Acting committee chairperson Leonard Ramatlakane said the levy was not collected for road maintenance, but was part of how government raised funds to pay for social services, education, and health.
He was responding to the Organisation Undoing Tax Abuse’s (Outa's) much-repeated argument that the levy would be a more effective way to pay for Gauteng’s freeways.
Outa chairperson Wayne Duvenage said e-tolls were an extortion of Gauteng residents and only 9% of motorists complied and paid their bills.
Duvenage said since the Gauteng freeway improvement project started in 2007, fuel sales, and the levy, had been steadily growing.
Outa had been fighting the e-toll system in Gauteng since it was switched on in December 2013. It failed in several court attempts to stop the system, which was intended to pay for the upgrades to 185 km of freeways.
He said in 2008, the fuel levy was around R1.20 and had grown to over R2 at present.
“That is a massive increase. It’s a 92% increase on the fuel tax on motorists. This is a user-pays mechanism. Every time we fill our car up, every time we drive, we are contributing to the fuel levy. The fuel levy feeds into treasury’s coffers and that money is used to manage the country,” he said.
He said it was estimated that the levy would add R55-billion to the Treasury’s coffers this year. This could be used to pay for almost three Gauteng freeway improvement projects, in cash.
According to Outa's website the project cost R20.6-billion.
“The fuel levy is a justified user-pays mechanism,” he said.