The South African minister of electricity and energy, Kgosientsho Ramokgopa, is proposing to suspend the country’s carbon tax after experiencing pressure from fossil fuel lobbies.
The carbon tax is based on a “polluter pays” principle under the Carbon Tax Act, which increases the cost of fossil fuel-intensive activities. When the law was passed in 2019, carbon emissions were taxed at a rate of R120 (US$7.50) per tonne of carbon dioxide. But some companies secured large reductions of the amount down to just R6-R48 (US$0.37-2.50) per tonne.
The tax is due for an increase this year as it enters its second phase. The annual tax revenue collected is estimated to be R1.5 billion (US$93 million), which is the same amount as was spent on early childhood grants in 2023.
