Government weighs using public money to help taxi industry buy electric vehicles

South Africa’s minibus taxi industry could soon become part of the state’s broader shift towards electric transport, if government decides to use taxpayer-funded support to help operators buy electric vehicles. According to Newsroom ZA, Transport Minister Barbara Creecy has confirmed that her department is looking at whether the existing Taxi Recapitalisation Grant can be used for this purpose.

The grant is paid from the National Revenue Fund, which means the money comes from South African taxpayers. That is the key reason the idea is drawing attention. Creecy has said government is considering whether public funding could help taxi operators access electric vehicles, especially as many motorists look for ways to lower fuel costs. The minister’s concern, as reported by Newsroom ZA, is that wealthier drivers may be able to afford electric vehicles while public transport operators remain stuck with vehicles that are expensive to run.

The proposal is still only under investigation. Newsroom ZA reports that it has not been confirmed as an approved funding programme. So, while the idea is on the table, there is no formal rollout announced yet. That matters because the taxi industry is one of the country’s most important transport systems, carrying large numbers of commuters every day, and any change in how it is funded would have a wide public impact.

At the same time, the possible use of state money is landing in the middle of another debate: tax compliance in the taxi sector. Newsroom ZA notes that minibus taxi operators are required to pay income tax, but the industry’s heavy use of cash makes enforcement difficult. Finance Minister Enoch Godongwana has already acknowledged that tax compliance is low in the sector and said government intended to improve collections. That context is why some people may question whether public support should be directed into an industry where compliance remains a problem.

The electric vehicle side of the story is also moving quickly. According to figures reported to the National Association of Automobile Manufacturers of South Africa, 3,217 fully electric vehicles were sold between January and September 2026. That is well above the 802 sold in the same period in 2025. Plug-in hybrid sales also jumped, rising from 1,784 to 8,082 vehicles over the same period. Even so, new energy vehicles still made up only 4.55% of total vehicle sales in the first nine months of 2026.

That shows there is growing interest in cleaner vehicles, but the market is still relatively small. In plain terms, electric and hybrid vehicles are becoming more common, yet they remain a niche part of South Africa’s overall car market. That is part of why government appears to be thinking about support measures, not just for private motorists but also for transport operators who depend on high-mileage vehicles.

Creecy’s comments also link this debate to another possible funding change. Newsroom ZA reports that she has proposed a vehicle licence disc renewal fee to help support the Road Accident Fund. The fund currently relies on fuel levies, and those could decline as more motorists move to electric vehicles. The minister has not yet said whether such a fee would apply to all vehicles or only to electric and hybrid models. The Automobile Association’s Bobby Ramagwede has criticised the idea, saying the RAF’s problems are more about operations than the growth of electric vehicles.

Taken together, these developments point to a government trying to adapt its transport funding model as vehicle technology changes. But there are still more questions than answers. The taxi grant idea, the possible licence disc fee, and the wider shift to electric vehicles all remain under discussion rather than settled policy.

What is clear is that the debate is no longer only about cleaner cars. It is also about who pays, who benefits, and how South Africa funds transport systems when petrol, diesel and fuel levy income may no longer be the only pillars supporting them.