With revenue stagnating, the Road Accident Fund (RAF) wants a portion of every licence disc fee in South Africa. According to its 2025/26 annual report, the money gained from every litre of fuel sold is still not enough to cover its diabolical finances.

That’s because it is in extreme financial trouble. The technically insolvent RAF faces astronomical total liabilities of more than R440 billion. And it’s drowning in massive backlogs and systemic administrative failures that only make matters worse.

LICENCE DISC FEE IN SA

The reason it wants to hit the licence disc fee in South Africa is because record fuel price increases in 2026 are driving lower-volume sales. Plus, it argues the National Treasury hasn’t shifted the levy significantly in recent years anyway. “During the period 2021 to 2026, inflation has continued to erode the fund’s real income,” it said:

  • R2.18 per litre in 2021/22.
  • Raised by 7 cents to R2.25 per litre in 2026.

The squeeze is visible in the numbers. Total revenue fell 5% to R48 billion in 2025/26 from R50 billion the year before, with net fuel levies making up 99% of it. As such, the RAF argues the 7-cent increase isn’t enough and it proposes a portion of the licence disc fee in SA as well. It says it faces constant pressure to fund an ‘unlimited claims trajectory.’

OTHER REVENUE OPTIONS AVAILABLE Would you welcome an extra levy on your annual licence renewal fee? Image: File

As such, RAF management has proposed to National Treasury it widens the levy beyond just fuel. Their argument is that new, more efficient electric/hybrid vehicles burn less fuel, so they pay less RAF levy. However, they still enjoy ‘the same cover’ as everyone else on the road. Other funding models could include:

  • Charging a levy on all foreign-registered vehicles entering South Africa.
  • Attaching a fixed levy to all vehicle registration and licence disc fee in South Africa.

Transport Minister Barbara Creecy confirmed back in July that a renewal-linked charge was being investigated. She said the Department of Transport sees the benefits of a new vehicle-linked transitional levy to capture revenue from all road users. For now, no licence disc fee system has been finalised, nor are figures on much it might increase by.  

But what do you think? Do you think the licence disc fee levy in South Africa would effectively work like a double tax on motorists? Please share your thoughts in the comments section below …