EFF vs fuel levy increase — court challenge tests legality of fiscal decisions

Daily Maverick

2 days ago

The EFF has filed an urgent court bid to block Finance Minister Enoch Godongwana's fuel levy hike, arguing it is irrational, economically harmful and unlawfully implemented. This is not just the EFF showing commitment to its stance against the increase, but a relatively novel legal precedent that could have far-reaching implications.
A last-minute legal bid
On Thursday, 29 May, the EFF filed papers in the Western Cape Division of the High Court to block a fuel levy increase announced eight days earlier during the Minister of Finance's Budget 3.0 tabling.
The case makes an unusual use of Rule 53 of the Uniform Rules of Court — a procedural mechanism regularly used to challenge administrative decisions — to challenge a fiscal measure introduced by the Treasury in Budget 3.0.
'We took this action after repeated efforts to caution the minister and appeal to his conscience failed,' said the party in a statement issued on the same day, stating that an increase without a Money Bill 'risks the entire national Budget being declared invalid by the courts'.
Though it hasn't sparked the same political uproar as the aborted VAT hike, the fuel levy increase is just as important, as a fuel increase touches aspects of almost all supply chains, increasing costs across every facet of life.
As economist Dawie Roodt told Daily Maverick, '… in terms of the effect on the poor, that is pretty much the same as the VAT increase'.
The fuel levy increase — 16c per litre for petrol and 15c for diesel — is scheduled to come into effect on 4 June. The EFF is seeking urgent relief before this happens.
The EFF Treasurer-General, Omphile Maotwe, told Newzroom Afrika the Treasury intended to gazette the increase on 3 June, 'to allow us no window or opportunity to interdict', hence the urgent application.
The EFF's legal logic
The application has two parts: Part A seeks an urgent interdict halting the increase and Part B calls for a full review and potential nullification of the decision, with the EFF arguing the increase must be reviewed in light of worsening inflation, stagnant wages and the fallout from the abandoned VAT hike.
While it's true that the fuel levy is a regressive tax, Roodt argues that the Treasury's hands are largely tied regarding other measures to generate revenue. 'South Africa's tax burden is already dramatically redistributive. You can't make it more so,' he said.
In its founding affidavit, the EFF argues that the fuel levy hike is procedurally flawed and substantively irrational. There was no consultation with Parliament, no socioeconomic impact assessment and no engagement with affected sectors.
The party says the decision punishes low- and middle-income households already buckling under cost-of-living pressures. While the minister has statutory power to adjust the levy, the EFF argues that using this mechanism — without oversight or legislative process — amounts to executive overreach.
The party called the increase 'yet another demonstration of the anti-black, anti-poor, neoliberal Budget the ANC government continues to impose on the people of South Africa'.
No word yet from Treasury
By the time of publication, the National Treasury had not responded to detailed questions from Daily Maverick about whether a socioeconomic impact study had been carried out, whether consultations with industry had occurred, and what the Treasury would do if an interdict were granted. This article will be updated once a response is received.
Minister in the Presidency Khumbudzo Ntshavheni did not discuss the fuel levy, but defended the broader Budget at a briefing to the media on Friday, 30 May.
'This pro-poor Budget means [that] on every rand, 61 cents of consolidated, non-interest expenditure funds will be spent on free basic services … social grants for those in need.'
A silent tax indeed
The fuel levy is often called a 'silent tax' — embedded in pump prices and not itemised like VAT. Its revenue flows into the National Revenue Fund and is not earmarked for roads or transport. Between 2012 and 2022, the general fuel levy rose from R1.77 to R3.93. It now accounts for about 6-7% of pump prices.
The 2025 increase is expected to raise R2.9-billion. Filling a 50-litre tank will cost about R8 more — a cost that ripples through logistics, transport and food prices. Unlike some OECD countries, South Africa lacks fuel subsidies or robust public transport, making the levy a heavier burden for poor households.
Can fiscal decisions be challenged in court?
Yes, as the EFF and DA's challenge of the VAT hike showed clearly — but this time the mechanism is different. That case primarily rested on constitutional and procedural grounds.
In this matter, the EFF is invoking Rule 53, seeking a review of the minister's decision. The rule requires the state to produce the full record of decision-making, allowing the applicant to supplement their case. Rule 53 is usually applied to administrative actions — permits, suspensions, authorisations — and not budgetary policy.
The stakes next week
The urgent interdict will be heard on Tuesday, 3 June. If granted, the levy will be paused pending the main review. If refused, it may take effect as scheduled, making a later review moot.
Should the court ultimately side with the EFF, it could invalidate the hike retrospectively, forcing the Treasury to re-table it through proper legislative channels. The ruling could also set a legal precedent, inviting future litigation over fiscal instruments previously seen as untouchable.
Who really pays?
Much of South Africa's fiscal debate is cloaked in specialised language: 'consolidation paths', 'debt stabilisation', 'medium-term frameworks', but the impact is direct: it's on you and I. Fuel taxes inflate the cost of moving people and goods, from taxis to tractors.
The EFF's challenge isn't likely to unravel the Treasury's broader strategy, but it could set a strong precedent for how fiscal policy can be challenged; at its core, the case asks who gets to hold the pen when new taxes are imposed, and if the courts should step in if Parliament does not. DM