The fuel price – if it isn’t on your mind, it should be, particularly with the next official fuel price adjustment due on 5 May. It is certainly weighing on Finance Minister Enoch Godongwana, who must now decide whether the temporary R3 fuel-levy relief granted can be extended, as South Africans brace for another steep increase at the pumps.
That pressure is not only economic – it is now before the courts.
In his answering affidavit in the Western Cape High Court, Godongwana makes clear that the Economic Freedom Fighters’ challenge to his power over the fuel levy comes at a time when the government needs to respond quickly to global shocks.
The urgency stems from a decision taken just weeks ago.
At the end of March, the government announced a temporary R3-per-litre reduction in the general fuel levy for both petrol and diesel, effective from 1 April to 5 May. The move was aimed at cushioning consumers from a sharp fuel price spike driven by rising global oil prices, linked in part to escalating tensions involving Iran, Israel, and the United States.
Read: Fuel relief now, answers later as the government buys time on price shock
The cut lowered the general fuel levy to R1.10 per litre for petrol and 93 cents for diesel, excluding other components such as the Road Accident Fund levy and the carbon fuel levy. It carries an estimated cost of R6 billion in foregone revenue for April and is intended to be temporary and fiscally neutral, with the shortfall to be absorbed elsewhere in the Budget.
In practical terms, the government bought a short window of relief.
That window is now closing – and the numbers suggest what may follow.
Mid-month data published on 16 May by The South African, based on figures from the Central Energy Fund (CEF), points to significant increases if current conditions persist. Petrol 93 is showing an under-recovery of around R2.43 per litre, while Petrol 95 is tracking closer to R2.80. Diesel increases are even sharper, at roughly R8.51 to R8.53 per litre, with illuminating paraffin up by about R6.79.
These projections are driven by two familiar pressures: elevated global oil prices and a weaker rand. At the time of publication, Brent crude was trading about $95 to $96 per barrel, while the rand was at about R16.20 to R16.32 against the US dollar.
The volatility has been amplified by disruption in the Strait of Hormuz, a critical artery for global oil trade, where geopolitical tensions have unsettled shipping routes and supply flows. Even partial disruption has pushed up transport and insurance costs, feeding directly into fuel pricing for import-dependent economies like South Africa.
If the levy relief is not extended beyond 5 May, consumers face a double hit: the return of the R3 levy combined with these underlying increases. In that scenario, pump prices could climb sharply in a single adjustment cycle.
This is where the legal fight becomes critical.
The EFF is seeking to remove the minister’s authority to adjust the fuel levy, arguing that only Parliament has the constitutional power to impose or amend taxes. The case carries broader implications for National Treasury’s control over revenue instruments, particularly after its recent court case loss on value-added tax.
Godongwana disputes that position, framing the issue as one of timing and responsiveness. He argues that requiring parliamentary approval for each adjustment would leave the government unable to react to fast-moving global events, exposing consumers to prolonged price shocks.
“If the applicant were to succeed, any ability to provide an immediate cut (or where circumstances dictate an upward adjustment) would be near impossible,” he states in the affidavit. Parliamentary processes, including consultation, would delay any intervention by months.
He also argues that the case no longer stands on its original footing. The EFF’s application was based on last year’s fuel levy increase – 9 cents per litre for petrol and 8 cents for diesel – but the subsequent R3 reduction has, in his view, reversed any harm to consumers.
“The latest downward adjustment has neutralised the one complained of, and [therefore] the factual basis for the applicant’s case has now lapsed.”
The relief measure, costing about R6bn, is being accommodated within the existing fiscal framework through internal adjustments. The minister presents this as evidence that fuel levy decisions are responsive to market conditions and designed to remain broadly cost-neutral.
He warns that removing this flexibility would limit the government’s ability to act in real time as global energy markets remain volatile.
The case is set to be heard on 20 May.
Fuel levy increase: revenue substitute or routine adjustment?
The EFF’s Part B challenge also targets the legality of the fuel levy increase announced in the 2025 Budget, linking it directly to the abandoned VAT hike.
The sequence is central to the argument.
When the first version of the 2025 Budget was tabled, it included a proposed 0.5-percentage point increase in VAT, with no increase in the general fuel levy. That proposal was later withdrawn after legal and political pressure, including court action by the Democratic Alliance.
A second iteration of the Budget followed, but uncertainty around the revenue framework persisted. It was only in the third version of the Budget that the VAT increase was fully abandoned, and the fuel levy adjustment introduced instead – increasing by 16c per litre for petrol and 15c for diesel, effective from June 2025.
Before Part B, the EFF had already tested the issue in urgent proceedings. Its Part A application, heard in early June 2025, sought to suspend the implementation of the fuel levy increase pending the outcome of the main review. The Western Cape High Court dismissed the application, allowing the increase to take effect. In doing so, the Court found that the EFF had failed to establish a prima facie right to the relief sought and had not set out sufficient grounds for the review it intended to pursue.
Read: Minister can increase the fuel levy without parliamentary process
In Part B, the EFF argues that this sequence amounted to a substitution: the fuel levy increase was introduced to plug the revenue gap left by the scrapped VAT hike, without going through the constitutionally required parliamentary process.
Godongwana rejects that interpretation.
In his answering affidavit, he states that the fuel levy adjustment was not designed to replace lost VAT revenue and should not be understood as a new tax increase. Instead, he describes it as a routine inflationary adjustment to a levy that had been unchanged for several years.
In real terms, he argues, failing to increase the levy would have reduced its value. The 2025 adjustment, on this reasoning, restored its purchasing power rather than expanding the tax burden.
The fiscal gap left by the abandoned VAT increase was substantial.
According to the minister, if the VAT increase had proceeded, tax revenue was projected to rise from R1.86 trillion in 2024/25 to R2.29 trillion in 2027/28. Its withdrawal resulted in a downward revision of revenue projections by R61.9bn.
By comparison, the fuel levy plays a far smaller role. The minister points out that without the 2025 adjustment, the government would have needed to raise an additional R4.1bn in that fiscal year through other means – whether higher taxes elsewhere, spending cuts, or increased borrowing.
He maintains that equating the fuel levy to VAT misrepresents both its scale and its function within the tax system.
That position is consistent with the High Court’s earlier finding that fuel levy adjustments are not Money Bills and do not require the full parliamentary process envisaged under section 77 of the Constitution.
The Part B proceedings now place that reasoning under scrutiny.
VAT ruling: precedent or misplaced comparison?
The EFF’s case draws heavily on the DA’s successful challenge to the VAT increase.
That challenge followed the first version of the 2025 Budget, in which Godongwana announced a phased increase in VAT from 15% to 15.5% in 2025 and to 16% in 2026.
The DA’s Part A application sought urgent relief to stop the increase before it took effect. On 27 April 2025, the Western Cape High Court granted an order suspending the hike, after the minister agreed not to proceed pending the outcome of Part B.
Part B addressed the constitutional question.
It challenged section 7(4) of the VAT Act, which allowed the minister to adjust VAT rates ahead of parliamentary approval. The DA argued that this amounted to an unlawful delegation of taxing power, violating the principle that only Parliament may impose or amend taxes.
On 5 March 2026, a full bench of the High Court upheld that argument.
The Court declared section 7(4) unconstitutional and invalid, finding that the power to determine VAT rates is a core legislative function that cannot be exercised by the executive. The declaration was suspended for 24 months to allow Parliament to amend the legislation.
The EFF relies on that ruling to support its case on the fuel levy, arguing that the same constitutional principle applies.
Godongwana disputes that.
In his answering affidavit, he argues that VAT and the fuel levy operate within fundamentally different legal frameworks. VAT is a broad-based consumption tax, and the Court found that the minister had been exercising a form of plenary power that properly belongs to Parliament.
The fuel levy, he argues, is different. It is imposed under the Customs and Excise Act and adjusted through a system of delegated authority that allows amendments by notice within an existing statutory structure, with parliamentary oversight.
He also points to practical differences. VAT applies across the economy and is embedded in countless transactions, which makes reversals difficult. The fuel levy is a more targeted instrument that can be adjusted in response to changing market conditions.
On that basis, he maintains that the VAT judgment does not support the EFF’s case, but instead illustrates why different tax instruments are treated differently in law.
The court will now have to decide whether that distinction holds.
If it does, the current framework for adjusting the fuel levy remains intact. If it does not, the implications could extend beyond the fuel levy, affecting how the government manages revenue more broadly.
