SOUTH Africa’s controversial carbon tax has finally been made law, according to Reuters which cited the National Treasury on Sunday.
The first phase of the tax is from June 1 to December 2022, with a tax rate of R120 ($8.34) per ton of carbon dioxide equivalent, said Reuters.
“A review of the impact of the tax will be conducted before the second phase and will take into account the progress made to reduce GHG (greenhouse gas) emissions in line with our National Determined Contribution,” the treasury said.
The second phase will run from 2023 to 2030.
The tax was first mooted in 2010, but has been postponed at least three times after mining companies, steelmakers and state-owned power utility Eskom said it would erode profit and push up electricity prices.
The Minerals Council South Africa said that on a net basis some 6,836 jobs could lost as a result of the tax. Anglo American Platinum (Amplats) said the tax will cost between R200m and R300m in the next three years.
Chris Griffith, CEO of Amplats, said that marginal mines would be further pressured by the proposed tax and that the government ought to focus on enabling mining companies to invest in renewable energy sources as a means of lowering the country’s carbon footprint rather than installing what was “just another tax?”.
