The Western Cape High Court has dismissed the EFF’s urgent application seeking the suspension of the fuel levy increase that is set to take effect from June 4.
This sets in motion finance minister Enoch Godongwana’s plans to raise revenue of R3.5bn in implementing the hike.
Godongwana said in his budget speech to parliament the general fuel levy would increase by 16 c/l for petrol and by 15c/l for diesel.
The EFF initiated the legal challenge against Godongwana last Thursday, giving the minister limited time to file an answering affidavit before the matter was heard on Tuesday.
EFF lawyer Mfesane Ka-Siboto argued Godongwana, in implementing the fuel levy hike to raise revenue after suffering a blow to the proposed VAT hike, acted unlawfully because he did not submit the proposed levy increase in parliament in the form of a bill to be approved by MPs.
Ka-Siboto argued the minister needed MPs’ approval because the increase was, in essence, a tax increase and needed parliament’s approval.
The party pinned this on Godongwana’s remarks during the budget speech on May 21 in which the minister said: “Tax revenue projections have been revised down by R61.9bn over the three years. This reflects the reversal of [the] VAT increase and the much weaker economic outlook.
“To this end, this budget proposes an inflation-linked increase to the general fuel levy. For the 2025/26 fiscal year, this is the only new tax proposal that I am announcing.”
The EFF argued that the constitution dictated that only elected representatives could impose taxes.
Ka-Siboto said the increase would be a blow to the poor, adding that Godongwana said in his speech “low-income earners spend more than 50% of their income on transport”.
Advocate Kameel Premhid, for Godongwana, dismissed the party’s arguments that the minister needed parliament’s approval in implementing a fuel levy hike.
Premhid described the EFF’s arguments as “fatal” to its own case, adding that the minister had the legal powers to change the levy.
He pinned his arguments on provisions of the Customs and Excise Act.
“The constitution reserves tax policy for the executive and oversight for parliament. Our courts, including the Constitutional Court, have deferred to that design. The EFF here asks this court to ignore that. It cannot,” he argued.
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