Budget 2014: 10 things worth knowing

rp_Budget-2014-News1-150x150.jpgBy 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. Itís a steal adding only 7.82c to the cost of a litre.

3. Taxes will make your fuel price rise even more. Fuel will be 20c more expensive from April 2. Because of recent increases in the fuel price, the fuel levy rise is inflation-related (12c) and the Road Accident Fund levy is up by 8c.

4. Now is the time to save. A new top-up retail savings bond will be introduced by Treasury this year to allow for regular deposits. Laws to allow for tax-exempt savings account will go ahead this year to encourage household savings.

5. Grants will rise, but by little. Old age and disability grants are up from R1 270 per month to R1 350, foster care grants are up from R800 to R830 and the child support grant is up from R300 to R310/month in April, and to R320/month in October.

6. Things are not as bad as theyíve been made out to be. The budget deficit is 4% of GDP, lower than projected in October. Narrowing to 2.8% in 2016/7. The taxman collected R1 billion more in taxes in the past year than Treasury thought he would.

7. Still, things arenít great. National Treasury is expecting a 2.7% growth rate this year, which is a little more slowly than projected a year ago.

8. Belt-tightening is working. National and provincial government spend on travel, catering and consultants is down.

9. Those earning below R250 000 will get 40% of the R9.25 billion tax relief.

10. The implementation of the carbon tax is postponed by a year to 2016 to allow for further consultation.