The South African Petroleum Industry Association (SAPIA) says the government has no choice but to adjust the price of fuel to the vagaries of the international oil price and the exchange rate against the American dollar.
Fuel prices are expected to climb to R4 per liter in June.
The association’s strategic project manager, Kevin Baart, said that if the government does not work according to labor rules, it will have a negative impact on the oil industry.
“We are looking at 70-80% of our local supply, it comes from imports. If the government does not match an increase in oil prices with an increase in the price at the pump, companies will be reluctant to import and as a result, you might see stock outs and have a serious economic impact on the country.Unfortunately we just have to bite the bullet,there is not much the government can do.
In March, Finance Minister Enoch Godongwana reduced the general fuel tax by R1.50 for April and May following a sharp increase influenced by high world oil prices following the Russian-Russian war. Ukrainian.
Baart says the government is unlikely to extend the fuel tax cut because taxes and duties contribute 10% of national income.
“For the 2019 fees and levies, they bought R120 billion from the national exchange, which makes it a pretty big source of revenue. You can see the levy over the last two months must have had a big impact on how the national treasury handles this.”
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