Minister of Finance Enoch Godongwana arrives with his team to deliver the 2023 Budget speech at the Cape Town City Hall on Wednesday. Picture: Phando Jikelo/African News Agency (ANA)
Economists have said South African Finance Minister Enoch Godongwana’s 2023 Budget speech was widely positive and gave the country a good platform to move forward.
Godongwana tabled his Budget in Parliament on Wednesday, announcing no tax increases for consumers, the government’s plan to help with Eskom’s massive debt, and tax incentives for renewable energy.
The finance boss said the government will be taking over R254 billion of Eskom’s colossal R423 billion debt in a bid to address the power utility’s persistently weak financial position and enable it to conduct the necessary investment and maintenance.
Godongwana said the debt relief the government was proposing had strict conditions and would be about R168bn in capital and R86bn in interest over the next three years.
Listen to Frank Blackmore, lead economist at KPMG, share his thoughts on the minister’s speech below:
Tax incentives for renewable energy
The government will introduce a new tax incentive for individuals to install rooftop solar panels to reduce pressure on the grid and help ease load shedding, according to Godongwana.
“Individuals who install rooftop solar panels from 1 March 2023 will be able to claim a rebate of 25% of the cost of the panels, up to a maximum of R15 000. This can be used to reduce their tax liability in the 2023/24 tax year. This incentive will be available for one year,” the minister said during his speech.
Listen to Sarika Rautenbach, director of Global Mobility Services and Employment Tax Advisory give her views on the minister’s Budget below:
The government is also proposing a 4.9% increase in excise duties on alcohol and tobacco in line with expected inflation.
The minister announced that there would be an increase in duties on 340ml cans of beer, 750ml bottles of wine, 23g cigars and packs of 20 cigarettes.
Joubert Botha, head of Tax and Legal at KPMG South Africa, also shared his thoughts on the Budget with “Business Report”.
Listen to Botha below:
Click here to view Business Report’s full coverage of the budget speech.
BUSINESS REPORT