Independent economist, Dawie Roodt, is almost certain the fuel levy will rise when Finance Minister, Pravin Gordhan, presents his annual budget speech.
This comes days after the RAF announced their account had been frozen and could no longer pay out claimants.
Rise In Fuel Levy Despite Two 2017 Fuel Hikes
Petrol has increased by 79 cents so far this year, while diesel is already up by 60 cents per litre amid rising oil prices.
“The government has a R28-billion hole to fill in its budget and about the only line items left where he can levy substantial taxes are VAT and taxing the middle class,” Roodt said.
Neil Roets, CEO of debt management company, Debt Rescue, said “We all know that when the price of fuel escalates, the prices of everything else rises in concert”.
Roets said he was also fearful of the impact that increased taxes and levies will have on already indebted consumers.
The Save South Africa movement is planning to hold a People’s Assembly on Wednesday morning (10am) at St George’s Cathedral in Cape Town.
NGOs and civil society groups will be discussing what they’ve termed, “the real state of the nation”. The movement will table issues they believe President Jacob Zuma should focus on, during his speech.
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“I am convinced that we are going to see a substantial increase in the fuel levy, which together with rising crude oil prices is going to cause the fuel price to skyrocket. The fiscus will need another R15-billion in 2018-19. This will require more than routine tax increases and, once again, the middle class is probably going to have to shoulder the bulk of these taxes,” Roets said.
The fuel price has risen twice in 2017 alone.
Roets warned consumers to learn to live within their means to combat the rising cost of living. He added that more than 50% of consumers were three months or more behind in their payments. The major culprits? Credit and store cards, followed closely by unsecured debt.
“It is these people who are going to bear the brunt of the government’s inability to curb spending, which results in higher taxes year after year.”
“Personal loans still outnumber other types of debt,” says Roets.
Which age category had the most debt? According to Roets, the age group over 65 had the most debt linked to credit card debt.
Pravin Gordhan will deliver the annual Budget Speech on Wednesday, 22nd of February.