Budget 2017/18 in a nutshell

2/22/2017


Today, finance minister Pravin Gordhan presented the budget. The minister pointed out that our Constitution, "all who live in our country should have access to housing, medical care, social security, water and education. He also said that there be a progressive realisation of access to tertiary education and other elements in a comprehensive set of social entitlements.

Wealth and economic opportunities must be equitably shared.

These commitments impose obligations on government – and have implications for the business sector and all stakeholders. We have a shared responsibility to address the social and economic challenges before us.

Summary of the 2017 Budget

Madam Speaker, today’s Budget message is that we are once again at a crossroads. Tough choices have to be made to achieve the development outcomes we seek:
  • Economic growth is slow, unemployment is far too high and many businesses and families are under stress.
  • We face an uncertain and complex global environment.
  • At the same time we face immense transformation challenges – we must overcome the inequalities and divisions of our society. All South Africans must share in a more prosperous future.
  • We have a plan for a more inclusive, shared economy. Its implementation requires greater urgency and effective collaboration among all social stakeholders.
  • Change is difficult, and often contested. In these tough times we draw strength from the resilience and the diverse capabilities of our people, our business sector, our unions and our social formations.
The main tax proposals are:
  • A new top personal income tax rate of 45 per cent for those with taxable incomes above R1.5 million.
  • An increase in the dividend withholding tax rate from 15 per cent to 20 per cent.
  • Limited bracket creep relief, increasing the tax free threshold from  R75 000  to R75 750.
  • An increase of 30c/litre in the general fuel levy and 9c/litre in the road accident fund levy.
  • Increases in the excise duties for alcohol and tobacco, of between 6 per cent and 10 per cent.

Here is the budget in a nutshell:

- Where large firms are awarded tenders of R30 million or more, 30 per cent of the contract value must go to small or black-owned enterprises, where feasible.

- R16.7 million has been allocated for new Metrorail trains.

- The Provincial Roads Maintenance Grant allocated R10.8 bill - 2017/18, taking into account the increase in road traffic.

- About two-thirds of the Budget is dedicated to realising social rights.

-  Further consultations are currently taking place on the tax on sugary beverages.

-  A new top personal income tax rate of 45 per cent for those with taxable incomes above R1.5 million.

-  The annual allowance for tax free savings accounts will be increased to R33 000.

-  An increase of 30c/litre in the general fuel levy and 9c/litre in the road accident fund levy.

-  An increase in the dividend withholding tax rate from 15 per cent to 20 per cent.

-  R1.9 billion for broadband implementation.

-  R3.9 billion for small, medium and micro enterprises and cooperatives.

-  R1.9 billion for broadband implementation.

-  R4.2 billion for industrial infrastructure in special economic zones and industrial parks.

-  Mining and manufacturing employment declined by 80 000 jobs in 2016.

-  The services sector was the main contributor to growth in 2016, bringing nearly 120 000 new work opportunities.

-  Government debt will stabilise at about 48 per cent of GDP over the next three years.

- An additional R28 billion will be raised in taxes.

-  Our growth has been too slow – just 1 per cent a year in real per capita terms over the past 25 years
35 % of the labour force are unemployed or have given up hope of finding work.

-  Income growth has been uneven - the bottom 20 per cent have benefited from social grants and better access to services.

-  Wealth remains highly concentrated – 95 per cent of wealth is in the hands of 10 per cent of the population.

In the year ahead our focus must be on inclusive growth and a transformation action plan. Bold and ethical leadership is needed from all sectors of society.

In this way we can all embrace a vision of substantive meaningful transformation which will allow us to say we all own our economy.

It is not just at the level of leadership that there are transformation opportunities.

In our communities, there are strong bonds and powerful traditions of caring. These are wonderful social assets, and I believe that all of us can commit to doing more to make the lives of fellow South Africans better.

Obstacles there will be many. Overcome them. Detractors abound. Disprove them.

Negativity inspired by greed and selfishness will obstruct us. Defeat the bearers of this toxic ethic.

South  Africans,  wherever  you  are….  Own  this  process;  defend  your  gains;  demand accountability.

Be an active agent for change. Umanyano Ngamandla (Unity is power.)

  • Share:

You Might Also Like

0 comments