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The entire country is holding its breath to see whether Minister of Finance Enoch Godongwana will take action tomorrow to provide relief to consumers amidst sky-high fuel prices. AfriForum believes it is essential that the Medium-Term Budget Policy Statement (MTBPS) addresses this issue, alongside other measures designed to stimulate economic growth. While petrol and diesel prices in South Africa are currently at an all-time high, the government continues to collect levies amounting to nearly R7,50 on every litre of fuel sold. For this reason, AfriForum has been pressuring Treasury since May of this year to reform this system.

Tax collection from April to August of this year was nearly 8% higher than projected. AfriForum argues that this provides fiscal space for tax relief in critical areas. The organisation also points out that Treasury should, in any case, focus on cutting fruitless state expenditure, thereby creating room for future tax relief.

According to AfriForum Spokesperson Louis Boshoff, this fruitless expenditure includes the recurring bailouts provided to dysfunctional state institutions. “Institutions such as the South African Post Office and the Road Accident Fund urgently need to be reformed or shut down, rather than repeatedly pouring billions of rand into these failing entities,” explains Boshoff. “Taxpayers are currently under such immense pressure that there is absolutely no room for the squandering of funds.”

Another issue that AfriForum believes requires attention tomorrow is the status of the equitable share payments to municipalities – payments that were withheld by Treasury in July in an effort to enforce compliance with legal requirements. Municipal debt is becoming an increasingly significant risk, and it is within the Minister’s authority to demand stricter compliance.

AfriForum also reminds the Minister that these high tax collections are still being drawn entirely from the pockets of a shrinking group of taxpayers. “Every cent that ends up in the state coffers is like blood squeezed from a stone. It is time for the government to show greater appreciation for the country’s taxpayers,” concludes Boshoff.

Issued by AfriForum