Economic impact of a provincial fuel levy: a CGE analysis

Provincial governments in South Africa, commencing with the Western Cape, are expected to institute provincial fuel levies in addition to the existing national fuel levy in future. This paper presents results from a Computable General Equilibrium (CGE) model calibrated with a detailed Social Accounting Matrix (SAM) to evaluate the effects of a 3 percent provincial fuel levy implemented simultaneously in all provinces. The results are presented for the petroleum products market, government, the macro economy, industries, factor income (including employment) and household income and expenditure. Results indicate that although the impact of the fuel levy is not drastic, it is large relative to the expected revenue gain. The impact is distributed more uniformly than was expected. Bibliogr., notes, ref., sum. [Journal abstract]

Title:Economic impact of a provincial fuel levy: a CGE analysis
Authors: MacDonald, Scott
Reynolds, Sanri
Van Schoor, Melt
Year:2006
Periodical:South African Journal of Economics
Volume:74
Issue:3
Pages:422-441
Language:English
Geographic term:South Africa
External link:https://onlinelibrary.wiley.com/doi/10.1111/j.1813-6982.2006.00078.x/pdf
Abstract:Provincial governments in South Africa, commencing with the Western Cape, are expected to institute provincial fuel levies in addition to the existing national fuel levy in future. This paper presents results from a Computable General Equilibrium (CGE) model calibrated with a detailed Social Accounting Matrix (SAM) to evaluate the effects of a 3 percent provincial fuel levy implemented simultaneously in all provinces. The results are presented for the petroleum products market, government, the macro economy, industries, factor income (including employment) and household income and expenditure. Results indicate that although the impact of the fuel levy is not drastic, it is large relative to the expected revenue gain. The impact is distributed more uniformly than was expected. Bibliogr., notes, ref., sum. [Journal abstract]