The Draft Employment Tax Incentive Bill gives effect to the announcement by the President in his 2010 State of the Nation Address, and the 2010 Budget, that government will table proposals to subsidise the cost of hiring younger workers. The draft bill also gives effect to the 2013 Budget.
Cape Town – Finance Minister Pravin Gordhan drew a line in the sand on state spending on Wednesday, announcing cuts to official perks and giving half of government departments not a cent more in his mid-term budget review. In a last-minute agreement with cabinet, the state is to impose tighter guidelines on cars, accommodation and travel for all government leaders, from ministers to mayors. Gordhan said these would apply from December 1 and would spell an end to official credit cards, million rand vehicles, luxury hotel stays and expensive home upgrades for cabinet members. He told reporters it would also apply to the presidency. Asked about plans to purchase a new presidential jet, Gordhan said if this was necessary, it would be done. The finance minister said he expected the downgrading of official perks with regard to cabinet ministers would save only about R15m, but if applied across all Read More …
Cape Town – The governement will meet its budget deficit target for 2013/14, it was surprisingly announced in the mini budget on Wednesday.Although it was widely expected that the budget deficit of 4.2% of GDP would have to be lifted by Finance Minister Pravin Gordhan in the mini budget because of weaker economic growth, it will remain the same after including extraordinary receipts of R11.4bn and extraordinary payments of R0.2bn.When extraordinary transactions are excluded, the deficit climbs to 4.5%.According to the mini budget, the fiscal framework for the three-year spending period ahead strikes a balance between consolidation and support for the economy.The target of reducing the budget deficit to 3.0% of GDP in 2016/17 will therefore remain.Spending will remain within the non-interest expenditure ceiling established in the February budget. It states further that SA has several strengths that limit the vulnerability of its fiscal position and allow Read More …
Johannesburg – The SA Chamber of Commerce and Industry (Sacci) was “underwhelmed” by Finance Minister Pravin Gordhan’s mini budget. “The message from the minister had few details on planned changes to fiscal policies, and where details were given it was on peripheral matters like austerity measures for senior government officials,” Sacci CEO Neren Rau said in a statement on Wednesday. However, he said Gordhan could be commended for his emphasis on pragmatic economic policy and priorities, on the National Development Plan and investment, and on the fact that a growing economy was critical to government activities. Sacci welcomed comments about the country’s credit rating and government debt, and the commitment to reduce the fiscal deficit. “Much work still needs to be done to present South Africa as an investor-friendly destination,” Rau said. “Fundamentally, the fiscal deficit can only decrease if government spending is cut in a big way, which implies Read More …
Cape Town – Mixed reaction greeted the country’s mini budget framework, with opposition parties saying they were discouraged and the ruling party expressing satisfaction. The MPs spoke to reporters on the steps of the National Assembly on Wednesday afternoon, shortly after Finance Minister Pravin Gordhan tabled the mini budget. Democratic Alliance MP Tim Harris said the speech was full of reassuring rhetoric, but not nearly bold enough in tackling serious economic problems. “He speaks a lot about backing the NDP [National Development Plan], but then doesn’t table any of the practical measures that the NDP talks about, like active labour market policies, labour reform and removing trade barriers,” Harris said. “Without that action, I don’t think we’re going to make progress on stimulating growth, and currently we are growing at about two percent and this is half the rate of Turkey, Chile and Malaysia.”
Gordhan’s mid-term budget speech fulfils prophecies During his medium-term budget policy speech Finance Minister Pravin Gordhan kept the rhetoric upbeat and SA’s purse strings tight, as expected. Finance Minister Pravin Gordhan before the medium-term budget policy speech at Parliament in Cape Town. (David Harrison, M&G) Finance Minister Pravin Gordhan’s medium-term budget policy speech delivered in Parliament on Wednesday was the fulfilment of a general prophecy: he kept the rhetoric upbeat and the purse strings tight. This is the last medium-term budget speech to be heard before the 2014 elections.
In the 2013 Budget Speech, the Minister of Finance announced that restricting the deduction of excessive interest expenditure claimed by taxpayers in debt financing schemes has been on the tax policy agenda for a number of years and accordingly, legislative steps are now being taken to limit the interest deductions claimed by taxpayers in such schemes.
Author: Carmen Moss Holdstock (Cliffe Dekker Hofmeyr) The draft Taxation Laws Amendment Bill 2013 (TLAB) was released for public comment on 5 July 2013. Among other things, the TLAB proposes that, in order to curtail foreign businesses that supply goods and services in ‘cyber space’ from escaping the VAT net, all foreign businesses supplying digital goods and services will be required to register as VAT vendors in South Africa.
The National Treasury published the Taxation Laws Amendment Bill and the Tax Administration Laws Amendment Bill on Thursday for public comment. Picture: Gallo Images
On 27 February 2013 the Minister of Finance announced that a carbon tax will be introduced with effect from 1 January 2015. He also announced that a carbon tax policy paper would be published that will contain the details for the carbon tax. That policy paper was published on 2 May 2013. This article contains the key design features of the carbon tax as set out in the policy paper.