Zimbabwe’s government is facing intense and mounting pressure to roll back a series of “astronomical” fuel price hikes, with Finance minister Mthuli Ncube admitting the country’s fragile economy will suffer from the price madness.
The admission comes as the treasury chief confirmed on Saturday that the government was actively reviewing the existing architecture of taxes and levies in an effort to blunt the impact of surging global oil prices. The move follows a controversial decision on March 18, where the Zimbabwe Energy Regulatory Authority (Zera) raised the price of petrol to US$2.17 per litre and diesel to US$2.05 per litre.
Official justifications for the hike pointed toward global supply shocks rooted in escalating geopolitical tensions in the Middle East, specifically citing conflicts involving the United States, Israel, and Iran.
However, the scale of the increase has sparked a backlash from consumer advocates and business leaders who argue that the government’s own tax appetite is the primary driver of the high costs.
At the heart of the national outcry is the Zimbabwe Taxpayers Platform (Zitap), an advocacy group representing both institutional and individual taxpayers.
Zitap has called for immediate intervention, warning that the current pricing structure is a catalyst for “widespread inflationary pressures and economic instability”.
In a leaked fuel cost build-up document dated March 18—which was confirmed by Zera officials—the data reveals that a significant portion of what Zimbabweans pay at the pump goes directly into government coffers.
For diesel, the cost starts at a free on-board (FOB) price of US$1,3638 per litre.After addingpipeline and financing charges, the price reaches US$1.4327.
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The government then adds **US$0.422 in taxes and levies.
Once administrative costs (US$0.021), distribution fees (US$0.035),wholesale margins (US$0.065), and retail mark-ups (US$0.075)are factored in, the consumer pays US$2.05.
The disparity is even more pronounced for petrol. The FOB cost for petrol is significantly lower at US$1.0911per litre. .Even after pipeline and financing costs bring it to US$1.16, the price is “sharply inflated” by US$0.857 in taxes and levies.
After ethanol blending costs, administrative fees,and margins are added,the final price land sat US$2.16.
Zitap pointed out that these figures represent taxation rates of 21% for diesel and 39% for petrol. The group is lobbying the Ministry of Finance, Economic Development, and Investment Promotion to slash these rates to a flat 10%.
Zimbabwe has historically struggled with hyperinflation and currency volatility, often relying on high tax margins to fund government operations.
These historical factors provide context for why the government might be hesitant to reduce its primary revenue streams.
The fuel hike has placed Zimbabwe in a precarious position within the Southern African Development Community (Sadc). According to reports from fuel price tracker Global Petrol Prices, Zimbabwe now sells the second most expensive fuel in the region, surpassed only by Malawi.
A comparison of regional petrol and diesel prices per litre highlights the disparity:
-Angola: Petrol US$0.327/Diesel US$0.43
-Zambia: Petrol US$1.36/DieselUS1.19
-South Africa: Petrol US1.18/DieselUS1.27
-Botswana: Petrol US1.14/DieselUS1.20
-Mozambique: Petrol US1.30/DieselUS1.25
-Malawi: Petrol US2.85/DieselUS2.84
The fact that Zimbabwe’s petrol price (US$2.17) is nearly double that of several neighbouring states has fuelled perceptions that the domestic pricing model is detached from regional economic realities.
Business leaders have warned that the fuel price spike is a “cost shock” that could derail the country’s current stability.
Tapiwa Karoro, president of the Zimbabwe National Chamber of Commerce (ZNCC), noted that while the fuel sector operates largely in U.S. dollars, the “broader effect is imported inflation”.
Karoro warned that this inflation affects both USD transactions and the ZiG (Zimbabwe Gold) pricing structures. “The risk is therefore not only cost escalation but also the potential re-anchoring of inflation expectations,” Karoro told Standardbusiness.
He suggested that in the medium term, businesses would have to resort to cost-cutting and efficiency measures to survive the surge.
Zitap has voiced similar concerns, noting that the fuel hike threatens to disrupt a “30-year stability index” of a 4% inflation rate. The group is urging the government to tap into strategic reserves—accumulated through a specific five-cent-per-litre strategic reserve tax—to stabilise the market.
“The minister of Finance can strategically release stocks of gold, lithium, diamonds, or any such as has been saved,” Zitap said, expressing hope that these reserves were indeed saved for “such uncertain moments as we confront”. The group also called upon the Mutapa Investment Fund to take an active role in cushioning the economy from these external shocks.
The public’s patience appears to be wearing thin. Zitap’s Zimbabwe Tax Perception Survey 2025 revealed a stark disconnect between the government and the governed: nine out of 10 citizens surveyed said the current tax burden no longer matches their ability to pay.
As Ncube weighs the possibility of tax reviews, the government is caught between the need for revenue and the necessity of preventing a total economic slowdown.
The outcome of this review will likely determine whether Zimbabwe can maintain its fragile inflationary stability or if it will face a renewed cycle of price hikes across all sectors of the economy.
For now, the country remains on edge, watching as the “cost-push inflation” sparked by the pump prices ripples through the cost of logistics, food, and basic services.
