Tax News

Cape Town – Income tax relief of R9.3bn and massive future spending on social grants are among the main features of this year’s pre-election budget. Other highlights include a budget deficit that is expected to narrow to 2.8% of GDP by 2016/17, supporting a stabilisation of debt at 44.3% of GDP. Tabling his 2014 Budget in the National Assembly on Wednesday, Finance Minister Pravin Gordhan told MPs he expected a budget deficit of four percent of GDP for this year and next (2014/15). Tax revenue this year (2013/14) was expected to be R1bn higher than projected in the 2013 budget. Gordhan said real growth in non-interest spending should average 1.9% over the next three years. A spending ceiling committed government to a cap of R1.03trn in 2014/15, R1.11trn in 2015/16, and R1.18trn in 2016/17.

Cape Town - Finance Minister Pravin Gordhan has tabled his fifth and probably last National Budget in Parliament, strongly emphasising acceleration of economic growth to the National Development Plan’s goal of economic growth of between 5% and 6% as he kept spending under control and still surprisingly had room for some personal tax relief (especially for lower income earners). It is  a conservative budget with no big surprise. It will probably please most people with the coming elections in May in mind. The highlights are:

Carien du Plessis @carienduplessis #budget2014 26 February 2014 14:17 Rather than just “make a noise” about implementing the National Development Plan (NDP), government has put it in the budget, Finance Minister Pravin Gordhan has said. When reporters asked him about the NDP this morning ahead of his budget vote in Parliament, Gordhan said “the proof is in the book”. The budget review he tabled sported a long list of “NDP critical actions” and explanations on how these were being funded or implemented.

By Carien du Plessis@carienduplessis#budget2014 26 February 2014 14:02 Drowning in budget facts? Carien du Plessis compiles a list of what you should know. 1. The budget is R1.25 trillion. R1.1 trillion of that is noninterest spending, and it will grow to R1.6 trillion in 2016/7 (by 2%). 2. Sin taxes, as always, are going up. For example, a can of 340ml beer will cost 9c more, cigarettes are up 68c for a pack of 20 and whiskey is up by R4.80 per bottle. Tax on traditional beer will not go up. It’s a steal adding only 7.82c to the cost of a litre.

South Africans should go out and take up opportunities on the African continent, Finance Minister Pravin Gordhan has said. Addressing reporters this morning ahead of his budget speech in Parliament, Gordhan said South Africa has not fully recovered from the global economic crisis of the past five years, but “all isn’t dull either”. He said South Africans shouldn’t be complacent. “What South Africans need to do as the public and private sector is to seize potential opportunities on the African continent even more strongly than they have,” he said.

Capital expenditure by major state-owned companies has been projected to reach R381.9-billion over the next three years, says the national treasury. Capital expenditure by major state-owned companies is expected to reach R381.9-billion over the next three years and investments by Eskom, Transnet and the South African National Roads Agency Limited (Sanral) will account for 90% of it, the national treasury said in its budget review.

The Rural Health Advocacy Project says the Budget was “disappointing” as it does not make provision for improvements in healthcare service delivery. Finance Minister Pravin Gordhan’s 2014 Budget speech was “disappointing”, according to Daygan Eager of the Rural Health Advocacy Project at the University of the Witwatersrand.   He said that Gordhan’s commitment to lowering the budget deficit leaves little space for improvements in healthcare service delivery.

By  Sipho Kings The 2014 Budget has delayed the carbon tax, punted shale gas, budgeted for more independent energy, and asked that mines help fix acid mine drainage. Finance Minister Pravin Gordhan has delayed the carbon tax by one more year to 2016. Last year, he said it would start by January 1 2015. This was “to allow further consultation”. The point of the tax is to punish companies that do not lower their carbon emissions, but also to provide incentive to companies that change the way they do business.

By  Sarah Evans Treasury will increase funds to the National Student Financial Aid Scheme, which is likely to help more than 500 000 students per year. With some universities across the country currently besieged by student protests over exorbitant fees and a shortage of bursary funds, national treasury announced on Wednesday that it will increase funds to the National Student Financial Aid Scheme (NSFAS). Government expects this to assist more than 500 000 students per year. The South African Students Congress (Sasco) called for mass protests this year over a shortage of NSFAS funds, which it said has excluded millions of poor students from the higher education system.

Finance Minister Pravin Gordhan’s final Budget speech before elections in May is a masterplan to please the masses.     On the eve of an election in the historically significant 20th year of South African democracy, Finance Minister Pravin Gordhan sang a carefully crafted song. It was not the voice of a sycophantic public servant; nor was it the voice of a self-congratulatory bureaucrat. Instead, he adopted the voice of the listener: the voice of the disgruntled electorate.    He spoke for those who had voted his party into power five years ago, and those who had recently publicly booed the president of the same.   Read Gordhan’s full speech (PDF)   A foray near the end of his speech best summed up his tone. “Puso e utlwa dillo tsa maAfrika Borwa! Ons het gehoor! Korrupsie moet gestop word! [We have heard you! Corruption must be stopped!] MaAfrika Borwa deserves better … Read More …