Several countries are moving towards a low-carbon economy and South Africa is leading other African countries in this regard.The South African government committed to ambitious greenhouse gas emissions reductions of 34% by 2020 and 42% by 2025 against a business as usual curve.Among the approaches adopted to achieve this target is the planned carbon tax policy by the South African government.As a carbon tax is introduced to mitigate emissions,prices of energy related product are expected to increase accordingly.Households are likely to be greatly affected since their energy-related expenditure is a substantial fraction of their incomes.Survey data shows that in 2015,household expenditure on housing,water,electricity,gas and other fuels and transportation accounted for nearly 50% of total annual household consumption expenditure in South Africa.
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