The Proposed Tyre Levy .... Is It Just Another Tax?
A recycling levy on the production and importation on all new tyres was to be introduced on 1 February 2012. In accordance with a notice published by the Department of Environmental Affairs 28 November 2011, the production and importation of all new tyres in South Africa would be subjected to a R2.30 a kilogram levy at source. The tyre levy was to be used for the collection and recycling of discarded tyres by an organisation to be known as the Recycling and Economic Development Initiative South Africa (REDISA).
It is conservatively estimated that some 11 million tyres with a mass of 200 000 tons gets dumped and burnt in South Africa annually causing serious threat to the environment. There can be no doubt there is a strong case to be made for a responsible tyre recycling and disposal programme. It is also estimated there are between 60 to 200 million scrap tyres in the South Africa environment serving as a fertile breeding ground for mosquitoes and vermin. With the rapid increase of commodity prices experienced in recent years waste and discarded tyre are burnt in an uncontrolled manner to retrieve the steel component causing serious air pollution problems.
It was envisaged the levy, when implemented, would add more than R20 to the price of a 9 kilogram tyre when the tyre manufacturers and importers pass the costs on to consumers. The tyre levy was seen as part of the Integrated Industry Waste Tyre Management to be managed by REDISA, Environment Affairs Minister Edna Molewa said. It was envisaged that the income generated from the tyre levy would be used for the collection of tyres, distribution to recyclers and research and development. The Minister also said the tyre levy collected by REDISA would be "ring fenced" and not find its way into the general fiscus. Viewed against the recent demise of the Fund established for plastic shopping bags this announcement was greeted with a degree of scepticism in many quarters.
The REDISA plan did not receive general acceptance and was opposed by the Retail Motor Industry favouring the South African Tyre Recycling Process Company, whose tyre recycling scheme was rejected by Minister Molewa. Some other interested groups also opposed the REDISA plan claiming it was flawed and flouted some of the procedural requirements stipulated in the Waste Tyre Regulations.
Acting Minister Environmental Affairs Collins Chabane on 24 January 2022, a week before REDISA was to the implemented, withdrew the scheme with immediate effect, sending the Department of Environmental Affairs back to the proverbial drawing board. After some months, the REDISA plan has emerged from under the radar and has been gazetted by the Department of Environmental Affairs for a 60 day comment period before being finally approved by the Cabinet. The most contentious part of the REDISA plan is that it is claimed it will place a R700 million-a-year business in the hands of one Johannesburg based business person.
Severe penalties of up to R100 000 in fines or imprisonment of 10 years may be applied for contraventions but the good news is waste tyre recycling may result in the manufacture of asphalt for roads and the production of footwear resulting in creating some estimated 15 000 new jobs.
Interestingly Wayne Duvenhage of OUTA, the Gauteng anti- e tolling activist has now joined the fray. He espouses the view that the recycling process should be self-funded or driven through the relevant industries and not imposed on the public with a sparse consultation.
Are we about to witness slogans such as "WE ARE TYRED OF THIS TAX" or "BANDE, SKANDE" in the coming months?