Revised 2025/26 Budget: Fuel Levy Increase and VAT Reversal

Posted 21 May 2025 Written by Acts Online
Category Parliament

Brought to you by SA Legal Academy: The Minister of Finance has issued a revised 2025/26 Budget speech, adjusting the fiscal framework to compensate for the withdrawal of the originally proposed value-added tax (VAT) rate increase.

In terms of the revised 2025/26 Budget, the National Treasury will reduce the size of provisional allocations across all spheres of government. These provisional allocations, which are not yet assigned to specific votes, are being curtailed to maintain fiscal sustainability while the baseline allocations remain largely unchanged. The Minister noted that while the ability to fund new programmes is reduced, the budget remains redistributive rather than an austerity measure.

The revised revenue proposals include a specific inflation-linked increase to the general fuel levy. The following adjustments will take effect from 1 June 2025:

  • An increase of 16 cents per litre for petrol; and
  • An increase of 15 cents per litre for diesel.

In response to these revisions, the National Assembly and National Council of Provinces (NCOP) Committees on Finance have issued a joint notice calling for written submissions on the revised fiscal framework and revenue proposals. The deadline for submissions is 26 May 2025, with parliamentary hearings scheduled to take place on 28 May 2025.

What this means for you, your business, or your clients

  • For yourself: No direct regulatory filing required; however, professionals should account for increased personal transport costs following the 1 June 2025 levy implementation.
  • For your business: Update logistics, fleet management, and operational cost projections to incorporate the 15—16 cents per litre fuel levy increase effective from 1 June 2025.
  • For your clients: Advise clients in the transport, retail, and manufacturing sectors to submit written representations to the Finance Committees by the 26 May 2025 deadline if the revised fiscal framework impacts their commercial viability.

Originally published at https://legalacademy.co.za/news/read/budget-2025-26-revised-with-fuel-levy-increase

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