The Impact of Carbon Emissions Tax in South Africa

1. The Impact of Carbon Emissions Tax in South Africa Presented by the Nkhensani Siweya

2. Why is global warming a concern? • Global warming is regarded as the biggest risk facing human kin, yet found to be man made through pollutions. • The Intergovernmental Panel on Climate Change (2018) indicated that 2018 was the fourth hottest year, thus resulting in extreme weather. • The International Monetary Fund (2017) indicate that there was an increase in mortality rates due to air pollution in 2010.

3. How is South Africa contributing to lower emissions? • South Africa, which ranked 11th among the top 20 countries mismanaging waste, is also taking its part in trying to combat global warming by: • Introducing paper straws • Selling Plastic bags • Reducing the use of plastics • Good green deeds programme • Reduce coal-use for energy purposes’. • South Africa pledges to reduce emissions to between 398 and 614 Mt CO2 in the short period 2025 to 2030.

4. Other countries that signed the agreement Lesotho Brazil Germany France Japan Ghana Zimbabwe Australia

5. What drives South Africa’s pollutions • The USAID report indicated that South Africa’s greenhouse profile is dominated by emissions from the energy and agricultural sectors. • Within the energy sector, emissions are broadly due to electricity and heat, while in the agricultural sector is driven by enteric fermentation. • South Africa imports most of its oil from the, while coal is mined domestically; thus using coal for electricity production. Source: USAID - Greenhouse Gas Emissions in South Africa

6. How are other countries regulating carbon tax • The UK government announced that the Carbon Emissions Tax will be implemented in April 2019. • The Carbon Tax period is designed to run for 9 month from 1st April 2019 for the first phase, before running for 12 months from the 1st of January 2020. • The carbon tax will be taxed at a marginal rate of £16 per tonne for any tax payer that exceeds the emissions allowance, and such taxpayers will be required to obtain a emit permit and submit an annual report, instead of a tax return. • India’s carbon emissions tax was introduced in July 2010 at 50 rupees per tonne under the Goods and Services Tax. • The carbon tax in India will be focused on certain economic sectors like road transport, industry, agriculture and fishing, residential and commercial and electricity.

7. How will it impact the domestic economy The newly introduced carbon tax on fuel is expected to weigh on the already depressed household spending. South African households have been faced with higher fuel prices due to a rise in global domestic prices. The aim of carbon tax is not to burden the household spending but to lower carbon emissions and contribute to combating global warming as per the Paris Agreement. To ensure that household spending is not heavily burdened by the carbon fuel levy, the tax is imposed at a low rate of 9 cents a litre on petrol and 10 cents a litre on diesel.

8. Thank You