Hidden “tax” hikes in new online car licence fees

The Organisation Undoing Tax Abuse (Outa) has warned of hidden price hikes in the fees charged by the Road Traffic Management Corporation (RTMC) through its new online renewal service, which it launched on Thursday.

While the organisation welcomed the ability to perform payments online, it said it could not accept the massive price increases slapped onto the services.

Outa senior legal project manager Andrea van Heerden highlighted that the R530 fee for the notification of change in vehicle ownership (NCO) was substantially more than the typical R150 when done in person.

In addition, users have to pay a further R99 courier fee to have the documents delivered to their chosen address.

In total, they would have to spend 300% more for an NCO when going online than when choosing to get the service in person.

Van Heerden said this was “nothing but a rip-off and an unacceptable money-making scheme”.

“Moving into the digital age and providing services through online portals is supposed to reduce the costs to customers, not increase them,” said Van Heerden.

“Imagine the outrage if the banking industry told its customers that transacting online will cost them 300% more than the charges applied if they came into the bank for their services.”

Outa wants transport minister Fikile Mbalula to explain why he was allowing the RTMC to introduce “massive service fees”, which were essentially new “additional taxes” and passing them off as “convenience fees”.

Fikile Mbalula, Minister of Transport

Van Heerden said the fees’ introduction was “nothing short of a gross abuse of power” that should not be allowed.

Outa warned it was seeing similar schemes creeping into many government departments, where services that society once received free or at minimal cost were being turned into profit centres.

“This is specifically the case with the RTMC, the Road Traffic Infringement Agency (RTIA), the Driving Licence Card Account (DCLA) and more,” Outa said.

“With massive increases in new revenue streams accruing to these state-owned entities, they find creative ways to spend this money, essentially becoming new breeding grounds for more corruption and maladministration,” Outa stated.

For example, Outa said RTIA CEO Japh Chuwe was allowed to increase his salary from R3.3 million a year to R10.8 million in one year.

No explanation for new fees

Outa previously objected to the fees when the Department of Transport first gazetted them in 2021.

Under those regulations, an NCO and new vehicle registration would cost R700.

The organisation alleges that the revised R530 price for these services, as issued in January, only slightly reduced the fees while forcing the costs into the system.

The department also did not explain why these additional fees should be applied.

“An online fee should not be higher than the fee charged at the offices; rather, the online fees should be substantially lower,” said Outa.

“This action by the RTMC and the Department of Transport goes entirely against the spirit of what President Ramaphosa said in his State of the Nation Address to South Africa last week about reducing regulatory burdens and red tape, it added.

The table below shows the prices of the online licence and car documentation renewal services offered at online.natis.gov.za.

Now read: Online driver’s licence renewals system offline — one day after launching

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