NICHOLAS WOODE-SMITH: Petrol is an essential good — remove tax on petrol

While food costs rise, people struggle to get to work and our prosperity dwindles — every drop of fuel we purchase furnishes the extravagant spending of the state.

This doesn’t just mean motorists can’t drive to a luxury restaurant or the mall. It means workers are forced to dip even further into their dwindling incomes to get to work, and that food prices rise as transport costs increase . And as these prices rise all prices rise, a knock-on effect that can devastate an economy.

Price fixing never works. All it does is remove a good from reality. When petrol is price-fixed too low there will be shortages. If it is price-fixed too high, consumers suffer. Rather let companies compete over selling petrol and see what the real price is. Rather than taxing an essential good the state should rather cut spending to make up the shortfall — perhaps by avoiding paying R22m for a giant flagpole or by eliminating wasteful parastatals that would function better in private hands.

That could help, big time!

👀

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