South Africa Cuts Fuel Levies to Ease Cost of Living

Finance Minister Enoch Godongwana announced R10 billion in temporary fuel levy reductions during the Medium-Term Budget Policy Statement on October 21, 2026. The measure aims to alleviate cost-of-living pressures driven by global oil supply interruptions and conflict in the Middle East. From November 4 to December 1, 2026, the levy will be reduced by R3 per litre for diesel and R1.50 per litre for petrol. A secondary phase will follow from December 2 until January 5, 2027, with reductions of R1.50 for diesel and R1 for petrol.

To fund the relief, R10 billion previously transferred to the Central Energy Fund will return to the National Revenue Fund. The budget also includes R20.5 billion for provincial health and education, R21.8 billion for local government basic services, and R6.9 billion for the South African Revenue Service to improve tax collection. Additionally, R823 million was allocated to the South African National Defence Force to combat gang crime and illegal mining.

Economic outlooks have dimmed, with the National Treasury lowering the 2026 growth forecast from 1.6% to 1.2%. While the government reported a primary surplus of R139.9 billion, high interest costs have left a main budget deficit of R301.6 billion.

The South African National Taxi Council welcomed the intervention, stating it would prevent immediate fare increases. However, the council argued that short-term measures cannot solve structural cost pressures and called for sustainable, long-term solutions to protect operators and commuters from volatile prices.