CO2 tax up as Budget hits motorists

IOL mot feb17 showroom pic . File picture: Joe Raedle / Getty Images / AFP.

Pravin Gordhan's 2016 Budget means more pain for motorists in the form of a higher fuel levy and a tyre tax, while those buying new vehicles will have to pay additional CO2 tax on their purchase.


As had been expected, government will increase the fuel levy this year. This effectively adds 30 cents a litre to the price of all grades of fuel from 6 April.

In the best case scenario, the new levy will simply erode an otherwise substantial fuel price decrease although it's impossible to tell what the fuel price situation will be in April as that depends on what mood the volatile rand and international oil prices are in during the course of March.

Budget going after soft targets: Outa

It is very likely that we'll see a fuel price reduction in March though, with mid-February data from the central energy fund pointing towards a petrol price drop of more than 50 cents.


The CO2 emission tax on new vehicles is set to increase from R90 to R100 for every gram per kilometre of CO2 over 120g/km. In the case of double cab bakkies, the tax rises from R125 to R140 for every g/km over 175.

Yet while the fuel levy has the potential to pinch motorists, and the population as a whole given that everyone depends on transported goods, the CO2 tax increase will have a negligible effect on those buying vehicles.

2016's new cars - here's what's coming

So how much more will you pay? As many smaller vehicles already emit less than 120g/km (at least according to the unrealistic lab tests that the fees are based on), you're hardly going to feel any pinch at the lower end of the market and, as you'll see below, even the higher-end vehicles won't increase by much more than R1000.

Some examples:

Kia Picanto 1.0 LS, R124 995, 117g/km +R0

Toyota Etios 1.5 1.4 Xi 5dr, R144 300, 138g/km +R180

VW Polo Vivo 1.4 Conceptline, R151 200, 147g/km +R270

VW Polo 1.2 TSI Trendline, R209 000, 117g/km +R0

Ford Fiesta 1.0T Trend, R219 900, 99g/km +R0

Toyota Corolla 1.6 Prestige, R265 700, 157g/km +R370

Nissan Qashqai 1.2T Visia, R295 900, 144g/km +R240

Mercedes-Benz C200, R480 331, 132g/km +R120

BMW X5 xDrive50i, R1 203 670, 224g/km +R1040

Audi A8 L 6.3 W12, R2 165 500, 264g/km +R1440

Isuzu KB 300D-Teq DC 4x4 LX, R549 800, 209g/km +R510


The 2016 Budget mentions that a R2.30 tyre levy, per kg of rubber, will be implemented from October to replace the current fee arrangements for tyres, although motorists have already been charged this R2.30 fee since 2013.

The levy isn't necessarily going to break the budget of the man in the street, given that an average car tyre weighs just 8kg, however transport operators will feel the pinch given how heavy those tyres can be.

The levy is intended to reduce waste, by funding a recycling company called Redisa, however a Carte Blanche insert in 2015 raised some serious suspicions around how the levy is actually being spent. Redisa has refuted these allegations and maintains that over 180 000 tons of rubber have been collected this far.

Outa is also planning to take Redisa to task over various allegations and perceived injustices and we'll bring you more on that as the saga unfolds.


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