Sasol may be subject to South African windfall taxes that could significantly affect earnings. At present, Sasol is appealing a recently recommended tax scheme that would have severely limited earnings.
Trevor Manuel has announced that the government will not impose a windfall tax on the synthetic fuels industry. The National Treasury in a statement said that it had been decided "not to proceed with a tax on the windfall profits earned by existing synthetic fuel producers in the interest of a conducive environment for additional investments in domestic fuel security”.
Sasol’s earnings are heavily dependent on oil prices. While this is true of any energy firm, Sasol is especially sensitive to price fluctuations because it costs them more to produce a barrel of oil than a traditional company.