May 2019 - As a signatory to the Paris Agreement, South Africa has committed itself in its NDC to peak emissions between 2020 and 2025, then plateau for approximately a decade and decline in absolute terms thereafter. A carbon tax has been identified as one key measure to achieve this target. Its introduction, however, was delayed several times.
After years of intense debate, South Africa’s parliament finally approved a national carbon tax of 120 ZAR (around € 7.40) per tonne of CO2e in February. The tax will come into effect from June 1, 2019 and increase annually by the amount of consumer price inflation plus two per cent until 2022.
The Partnership for Market Readiness (PMR) has provided support for designing and implementing the carbon tax and will continue assisting South Africa in the future. Support activities relate to the design of an offsets program, align South Africa’s carbon budgets policy with the carbon tax, improve its emissions measurement and reporting systems, and conduct stakeholder consultations.
The Partnership for Market Readiness is one of several initiatives supported by the German Government through BMU, with Africa being a focus region of BMU’s engagement. With the goal of assisting African partner countries in preparing for the Paris Agreement and in order to promote carbon pricing and the emergence of a vital carbon market with a strong role for Africa, BMU supports numerous initiatives in the region. These projects and initiatives are compiled in the brochure Unlocking Africa’s Carbon Market – An Overview of German Initiatives.