FUEL
Fuel level proposal slammed
Posted Thu, 06 Jul 2006
The Congress of SA Trade Unions (Cosatu) condemned on Wednesday the proposed Western Cape fuel tax of between ten and 50 cents a litre in addition to the current national levy. "The effect of such a levy would be to move the greatest burden of this special tax onto the poor people who spend a far greater proportion of their income on transport," Cosatu said in a media statement. "The effect of this tax will be to increase the cost of taxi and bus transport as well as having an inflationary impact on food."
Cosatu would oppose this "harsh tax" on workers and said it would be happy to explore a progressive taxation policy if additional income for service delivery was required. It reminded the provincial government that its national counterpart had allocated billions of rands to upgrade transport. Cosatu urged the provincial government not to place a burden on the poor and to consider alternative tax structures that moved the tax burden to the wealthy. The
Inkatha Freedom Party also expressed concern at the proposed levy.
"The IFP hopes that the MEC [Marius Fransman] has thought this levy through carefully, as with the recent drastic rise in the fuel price, this levy would mean an extra burden on motorist if the implementation is not done properly," said the party's spokesperson for minerals and energy, Eric Lucas. Lucas said a there was a need for public hearings to be held before the levy was implemented. Democratic Alliance spokesperson on transport in the province Robin Carlisle said the Western Cape's leading foreign currency earners — agricultural exports and international tourism — would be "severely compromised" by the tax. He said up to 90 per cent of foreign tourists entering the Western Cape made some use of tourist buses. A bus operator pumping a million litres of diesel a year would with a 50c a litre levy have an additional fuel bill of R500 000, which would dramatically affect the company's
viability.
The impact on agriculture and agricultural products would be even more profound. Farmers' profit margins were already very slender, and the levy would strike a "devastating blow" to primary producers. The DA would accept a levy only if provincial vehicle licence fees were brought closer to the national average, there was an undertaking that no further toll-gates would be introduced on major roads in the province, and public transport infrastructure was significantly improved.
Sapa
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