SA Joins Namibia In Cutting Fuel Taxes, Braces For R6 Billion Hit To Protect Consumers

South Africa Joins Namibia In Cutting Fuel Taxes, Says It Will Lose R6 Billion To Protect Customers

South Africa has followed Namibia’s lead by slashing fuel taxes for one month in a dramatic R6 billion (approximately US$324 million) move to shield motorists from soaring global oil prices. The temporary relief, announced on 31 March 2026, will see the general fuel levy reduced by R3 per litre from 1 April 2026 to 5 May 2026 as geopolitical tensions in the Middle East continue to rattle energy markets.

The decision mirrors action taken by Namibia just days earlier, creating a coordinated regional pushback against rising pump prices that have left Zimbabwean motorists paying nearly double what their neighbours now face.

‘We Had To Act’ – Treasury And Mining Chiefs Unite

Finance Minister Enoch Godongwana and Mineral and Petroleum Resources Minister Gwede Mantashe issued a joint statement on Tuesday outlining the urgent intervention. The ministers revealed that the temporary cut will reduce the general fuel levy for petrol from R4.10 per litre to R1.10 per litre, while diesel drops from R3.93 per litre to R0.93 per litre.

“The escalation of conflict in the Middle East has materially increased risks to global energy markets, placing significant upward pressure on domestic fuel prices,” the joint statement read.

“Recent data from the Central Energy Fund Group suggests historically high fuel price increases from April 2026 as a result.”

“In reaching this decision, the Minister of Finance sought to balance the socio-economic impact on the country and welfare impact on South African consumers, specifically regarding food and transport inflation, with the fiscal objectives announced in the February Budget.”

The relief measure will be re-evaluated on a monthly basis for the following two months, with government promising to implement mechanisms to recoup the foregone revenue within the fiscal framework approved during the 2026 Budget.

Namibia Blazes Trail With 50 Per Cent Levy Cut

South Africa’s move came after Namibia announced its own dramatic intervention on 27 March 2026, slashing fuel taxes by 50 per cent for three months to protect consumers from rising global oil costs. Namibian Minister of Industries, Mines and Energy, Modestus Amutse, confirmed the measure during a media briefing in Windhoek.

“This measure is necessitated due to the high price volatility of petroleum products, which resulted from the ongoing geopolitical tensions in the Middle East,” Amutse said.

“The objective is to smooth price volatility and ensure stability in domestic fuel prices.”

“Cabinet has resolved to reduce fuel levies by 50% for three months to mitigate the impact on consumers.”

Despite the tax cut, Namibia confirmed fuel price increases effective 1 April 2026, with petrol rising by N$2.50 (approximately US$0.14, about R2.59) per litre and diesel increasing by N$4.00 (approximately US$0.22, about R4.15) per litre. The new pump prices at Walvis Bay will see petrol 95 at N$22.08 (approximately US$1.20, about R22.89) per litre.

Zimbabwe Left Behind As Regional Prices Diverge

The contrasting approaches have thrown Zimbabwe’s fuel pricing policies into sharp relief. Zimbabwean motorists are currently paying US$2.17 (approximately R40.15) per litre for petrol – nearly double Namibia’s price of approximately US$1.20 (about R22.89) per litre.

Zimbabwe Energy Regulatory Authority (ZERA) data from 18 March 2026 shows that taxes and levies now dominate petrol pricing, with about US$0.857 in taxes per litre representing nearly 40 per cent of the total cost. Just two weeks earlier, taxes stood at US$0.5209 per litre – a jump of approximately 64.5 per cent in a matter of days.

“Pump prices are determined by international product prices, taxes and levies, and distribution margins,” the ZERA build-up stated.

“FOB prices have increased in line with global trends, impacting the overall cost structure.”

South African authorities have moved to quell fears of fuel shortages, acknowledging reports of supply disruptions in certain areas. The government assured the public that a sufficient fuel supply exists to meet current and projected demand.

“Reports of shortages in certain areas are largely due to localised distribution and logistical challenges driven by panic buying rather than a lack of national fuel stocks and these are expected to self-correct in the next coming days,” the joint statement said.

“Motorists and businesses are encouraged to purchase fuel responsibly and avoid unnecessary stockpiling.”

Namibian authorities issued similar warnings, with Amutse cautioning against unsafe storage practices and illegal fuel resale, noting that the country has sufficient resources to sustain supply for another two months.