EFF Fights Fuel Levy Hike in Court: A Test of Fiscal Legality in South Africa!
The Economic Freedom Fighters (EFF) has launched an urgent court challenge against South Africa’s recently announced fuel levy hike. The opposition party argues the increase is irrational, economically harmful, and unlawfully implemented, setting a potentially significant legal precedent for fiscal decisions in the country.
Key Highlights for Your Blog:
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Urgent Court Bid: On Thursday, May 29, 2025, the EFF filed papers in the Western Cape Division of the High Court. They seek to block Finance Minister Enoch Godongwana’s proposed fuel levy increase, announced eight days earlier during his Budget 3.0 tabling. The increase, set to take effect on June 4, will add 16 cents per liter for petrol and 15 cents per liter for diesel.
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Legal Strategy: Challenging Fiscal Decisions with Rule 53: The EFF’s case employs an unusual use of Rule 53 of the Uniform Rules of Court, a procedural mechanism typically used to challenge administrative decisions. They aim to use this rule to challenge a fiscal measure introduced by the Treasury in Budget 3.0. This makes it a relatively novel legal challenge with potentially far-reaching implications.
EFF’s Core Arguments:
Unlawful Implementation:
The EFF contends the minister has acted unlawfully by introducing a national tax increase without a proper Money Bill, as mandated by Section 77 of the Constitution and the Money Bills Act. They argue the minister used an administrative regulation (a government notice) instead of a legislative process that would involve parliamentary scrutiny and a vote.
Procedurally Flawed and Substantively Irrational:
The party states the hike lacks proper consultation with Parliament, a socioeconomic impact assessment, and engagement with affected sectors. They argue the decision punishes low- and middle-income households already struggling with rising living costs.
Executive Overreach:
The EFF views the minister’s use of a statutory power to adjust the levy without oversight or legislative process as executive overreach.
Precedent from VAT Hike:
The EFF highlights that the courts previously struck down a proposed VAT increase, which they similarly argued was an unlawful tax measure. They see the fuel levy increase as repeating this same unconstitutional and economically damaging approach.
Impact on Citizens: The fuel levy, often called a “silent tax,” directly affects the price of transport, food, and other essentials. The EFF warns that any increase will hit the poorest South Africans the hardest, contributing to inflationary pressures across supply chains. A 50-liter tank will cost about R8 more.
Treasury’s Defense and Government’s Stance:
The Treasury defends the increase, with its head of tax policy, Chris Axelson, stating that failing to adjust the fuel levy in line with inflation would cause a loss of about R3.5 billion in revenue. He argues that specific taxes like excise duties need inflation adjustments to maintain their real value.
Deputy President Paul Mashatile remains confident the government followed due process. He views the EFF’s legal challenge as “political theatre” rather than a substantive legal argument, stating the finance minister conducted a “very involved process of dealing with the budget, a lot of consultations.”
Cabinet members have also affirmed their support for the 2025 national budget, asserting the EFF has the right to pursue legal action but it does not stop the government from proposing a budget.
Court Proceedings and Potential Outcomes:
The EFF’s application has two parts: Part A seeks an urgent interdict to halt the increase before it takes effect on June 4. Part B calls for a full review and potential nullification of the decision based on its alleged unconstitutionality and irrationality.
If the court grants the interdict, it will temporarily stop the increase. If the court ultimately sides with the EFF, it could invalidate the hike retrospectively, forcing the Treasury to re-table it through proper legislative channels. If the interdict fails, the increase will proceed as scheduled, potentially making a later review moot.
This court battle highlights a critical debate over executive power versus parliamentary oversight in South Africa’s fiscal management, with significant implications for both government revenue and the daily lives of citizens.
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