Key Issues

South Africa’s carbon tax regime ‘rattles’ business community

The proposed South African carbon tax regime expected to kick off in June has rattled the country’s business community.

Anglo American Platinum (Amplats), said South Africa’s new carbon tax could cost the company between 200 million rand and 300 million rand (21.34 million dollars) in the next three years.

The Chief Executive of Amplats, Chris Griffith made this known at a conference on Tuesday in Johannesburg.

Griffith’s concern was the latest of the several complaints by firms and workers who said the tax would push up the price of consumer goods, along with other fuel levy increases.

From June 5, a carbon tax of nine cents per litre will be implemented on petrol and 10c/l on diesel.

Refunds cannot be claimed against the carbon tax, the Treasury said.

According to the budget office, the tax will assist in reducing emissions and ensuring South Africa meets its commitments under the 2015 Paris Climate Agreement.

It will be reviewed in three years.

Labour federation Cosatu said the carbon tax, in addition to an increase in the sugar beverages tax, was an indication that government had abandoned previous commitments to protect vulnerable workers.

The Automobile Association in a statement said the tax was grossly unfair”.

The association said this was because South Africans would be paying an emissions tax on inferior quality fuelin spite of not having access to higher quality fuels, which were available in many global markets.

The Organisation Undoing Tax Abuse (OUTA) also said the carbon fuel levy appeared to be disingenuous”.

This tax is a cynical abuse of public sentiment under the guise of tackling climate change, which is an imperative that requires urgent action,” said Heinrich Volmink, executive head of OUTA’s national division.

Volmink added that the carbon fuel levy appears to be disingenuous”, because there was no clear links to behavioural changes or in line with climate change mitigation initiatives.

Source: Voice of Nigeria