Carbon Tax Set for 2015

Department of Energy

Government plans to introduce a carbon tax in 2015 at the rate of R120 per ton of carbon dioxide.

This was confirmed in budget 2013 tabled in parliament yesterday.

The tax will be phased in over time.

The finance minister, Pravin Gordhan, pointed out that a tax-free exemption threshold of 60 per cent will be set during the first phase to help soften the blow.

Additional allowances for emissions intensive and trade-exposed industries will also be introduced to allow them to invest in projects outside their normal operations.

The rate will increase at 10% a year during the first phase scheduled to run from 2015 to 2020.

It is likely that the electricity levy will be phased out as the carbon tax is introduced.

An updated carbon tax policy paper is to be published for consultation in March 2013.

The minister also announced that support mechanisms for both bio-fuel production and the upgrade of oil refineries to cleaner fuel standards will be introduced.

This will help to ensure that South Africa produces fuel that is more environmentally friendly.

In terms of the Green Fund, an additional R300 million is to be added to the R800 million that was previously provided.

The Green Fund aims to support green initiatives within the private and public sector to assist South Africa’s transition to a low carbon, resource efficient and climate resilient development path.

More money is also being pumped into the integrated national electrification grant in order to increase the number of new electricity connections by 645 000 over the medium term.

The solar water geyser programme will also be continued until 2015/16.

Sabinet Cape Town Office


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