Tyre tax controversy in South Africa

South Africa – In a bid to tackle related pollution issues, all South African tyre manufacturers and importers have been told to register with the Recycling and Economic Development Initiative (Redisa) before January 31 this year and prepare to pay a new levy to cover end-of-life costs.

This demand, issued by Water and Environmental Affairs Minister Edna Molewa, has created controversy given that the tyre industry has been co-operating for well over a decade with various government ministries to help solve this problem. Their plan, however, has been rejected – much to the dismay of an industry that brings in more than Euro 50 million a year.

Among the critics is South African Tyre Recycling Programme (SATRP) Chairman Riaan van Niekerk, who states that the Redisa plan was ‘written in a way that means there is only one plan’. By eliminating competition, Mr Niekerk fears Redisa’s CEO Hermann Erdmann ‘is trying to set his own prices’.

Mr Erdmann has reacted to the allegation of creating a monopoly by saying: ‘There are an estimated 60 million scrap tyres across South Africa; still we have no organised or sustainable infrastructure to collect and dispose of them. Our approach puts the cost where it belongs: if you introduce tyres into the market, you must contribute up front to the cost of the eventual disposal of the tyres.’

The unpopular levy is to be calculated per kilogram of processed tyres and is effective from February 1.