The fuel levy hike is expected to bring in R23-billion by 2028, following increases of 16c for petrol and 15c for diesel. This comes after Treasury opted not to raise value-added tax to 15.5%. In his May 2025 budget speech, Finance Minister Enoch Godongwana said the levy hike was the only new tax proposal being introduced.
The fuel levy had remained unchanged since the 2021/22 financial year when it rose from R3.70 to R3.85. Treasury said the pause was intended to ease pressure from high fuel price inflation.
But the latest increase hits low-income South Africans hardest. Rising fuel prices drive up transport costs – a major expense for the working class. According to the Pietermaritzburg Economic Justice & Dignity Group, someone earning minimum wage and taking two taxis to and from work can spend more than a third of their income on transport alone.