New tax for anyone renewing their car licence in South Africa

The government wants to introduce a new tax on motorists to support the Road Accident Fund (RAF), an entity that already receives a portion of the money spent on every litre of fuel sold in South Africa.

Earlier this year, Transport Minister Barbara Creecy announced that her department was exploring new funding models to support the RAF, which has been technically insolvent for some time.

The proposed solution is a new transitional tax that will be added to the cost of vehicle registrations and licence disc renewals,

The Department of Transport (DoT) argued that such a tax is necessary to offset the growing adoption of electric vehicles (EVs), since they do not use fuel and therefore do not pay the Road Accident Fund Levy.

The RAF Levy is a tax that adds R2.25 to the price of every litre of petrol and diesel. It is the second largest fuel tax in the country after the General Fuel Levy.

The DoT said that fuel sales are expected to drop due to the rise of hybrid and electric vehicles, which will lead to a loss of revenue for the RAF.

This announcement was met with swift backlash from citizens, industry stakeholders, and civil action groups, who argued that motorists are already taxed enough and that the RAF should address its long-standing issues before it receives any more funding.

The department has since gone quiet on its plans to introduce the new licence disc tax. Our sister publication MyBroadband asked the DoT whether work on the new funding model is ongoing and if the new tax is still on the cards, but it didn’t respond by the time of publication.

Creecy previously said that the outcome of her department’s work would be communicated publicly once finalised, and that the new tax would ensure the RAF is supported during the transition to EVs.

The DoT’s plans were heavily criticised by AfriForum and the Automobile Association (AA). The latter argued that EV adoption is still in its infancy and that they are years away from having a meaningful impact on the RAF’s revenue.

AfriForum questioned why a new fee was being implemented on all motorists and not just EV owners, given the department’s justification for the tax.

Both groups pointed out that the RAF receives R45 billion per year from the RAF Levy and that its financial woes are not the result of a lack of funding; rather it is evidence of system mismanagement and corruption.

New licence disc fees for motorists in Gauteng

While the DoT is mulling plans to introduce a new tax on car licence disc renewals, Gauteng has gazetted a notice to raise the base price of renewals in the province.

The Gauteng Provincial Department of Roads and Transport recently gazetted the draft Gauteng Road Traffic Regulations Amendment Notice 2026, detailing a comprehensive increase in motor vehicle registration and licence fees.

The licence disc increases for different vehicle weight classes are as follows:

• 0 to 250kg – R252.00 to R264.00
• 251 to 500kg – R396.00 to R420.00
• 501 to 750kg – R432.00 to R456.00
• 751 to 1,000kg – R456.00 to R480.00
• 1,001 to 1,250kg – R528.00 to R564.00
• 1,251 to 1,500kg – R732.00 to R780.00
• 1,751 to 2,000kg – R1,104.00 to R1,176.00
• 2,001 to 2,250kg – R1,284.00 to R1,368.00
• 2,251 to 2,500kg – R1,536.00 to R1,632.00
• 2,501 to 2,750kg – R1,728.00 to R1,836.00
• 2,751 to 3,000kg – R1,956.00 to R2,076.00
• 11,501 to 12,000kg – R32,112.00 to R34,080.00

A similar increase will also be applied to specialised transport categories such as tractors and breakdown vehicles.