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The Portfolio Committee on Mineral Resources and Energy has adopted a report on fuel price which proposes numerous recommendations that include, among other things, that the Minister of Mineral Resources and Energy, in conjunction with the Minister of Finance, should consider moving the Road Accident Fund levy from the fuel price and locate it elsewhere. 

The committee recommends fast-tracking of the Upstream Petroleum Resources Development Bill which will ensure investment in the upstream petroleum industry. 

The committee will be briefed for the first time about this Bill in the second quarter by the Department of Mineral Resources and Energy, thereafter the committee will then begin with the process of public consultation. 

Eight high-level stakeholders were consulted in the process of preparing the report. The stakeholders are: the Department of Mineral Resources and Energy, National Treasury, Council for Scientific and Industrial Research, South African Petroleum Industry Association, Fuel Retailers Association, the South African Oil and Gas Association, South African Petroleum Retail Association as well as Liquid Fuels Wholesalers Association.

As part of its observations, the committee notes that since there is no Value-Added Tax in the price of paraffin, a relief on liquefied petroleum gas (LPG) should also be possible because both paraffin and LPG are energy sources commonly used by the poor households. 

The report will now be tabled in the National Assembly for final adoption and further processing. 

Meanwhile, the Chairperson of the Committee, Mr Sahlulele Luzipo, has welcomed the announcement by the Minister of Finance on temporary reduction in the fuel levy arguing that any form of intervention that will alleviate the burden of high fuel price is a welcome relief. 

Mr Luzipo particularly welcomed the National Treasury’s decision not to increase levies on both fuel and Road Accident Fund in the 2022/23 financial year as well as temporary reduction of the current general fuel levy by R1.50c per litre for a period of two months. 

“Although a two-months’ relief is not enough, the intervention, however, is in line with the committee’s recommendation that the Minister of Mineral Resources and Energy together with the Minister of Finance should develop mechanisms to address the fuel increases, and consider introducing a tax holiday/exemption in all petroleum products,” said Mr Luzipo.

Issued by The Chairperson of The Portfolio Committee on Mineral Resources and Energy, Sahlulele Luzipo