Agriculture is being punished, farmers’ organisation TAU SA said on Wednesday. Finance Minister Nhlanhla Nene’s 2015/16 budget increased fuel taxes and made no allocation towards drought relief.
“With the current severe drought, we would have liked that the minister [of finance] would have made an allocation for drought relief in advance,” TAU SA said in a statement.
“The earlier farmers who are hit by the drought can be helped back on their feet, the less food needs to be imported. Imports of food will have an adverse impact on the country’s payment balance.”
The cutting of the overall agriculture budget to R6.38bn showed it was not a priority, the organisation said.
The fuel levy would not bode well for farmers.
“This will have a negative effect on the economy, while it will lead to rising food prices.
“Whether it’s a wise decision to allocate as much to emerging farmers while commercial farmers are struggling to keep their heads above water, is an open question.”
South Africa’s petrol and diesel tax amounts to 28%, but after a hefty 80.5c a litre, the tax will increase to 41%.
Finance Minister Nhlanhla Nene will add a staggering R17bn extra that motorists will cough up this year.