Latest news with #R7.5bn
IOL News
21-05-2025
- Business
- IOL News
Eina! Motorists to feel the pinch as Finance Minister notes increase in fuel levy
Finance Minister Enoch Godongwana Image: GCIS/Phando Jikelo South Africa's National Budget, which was finally tabled on Wednesday after three previous attempts, is not one in which government seeks to reduce expenditure, Finance Minister Enoch Godongwana said. However, in seeking to increase revenue for the state's coffers, the budget proposes an inflation-linked increase to the general fuel levy, said Godongwana. He added that this was 'the only new tax proposal that I am announcing' and would be the first fuel levy increase in three years. Both Old Mutual chief economist Johann Els and Investec chief economist Annabel Bishop expected such an increase, although Bishop had also expected that the duties on tobacco and alcohol would increase. However, said the Minister, this will not be enough to close the revenue gap. Subsequent budgets will have to find additional revenue sources, said Godongwana. Before tabling the Budget, Godongwana said that the votes on it needed to happen before the end of July as Departments were running out of money. The Budget was, for the first time in nine years, not physically attended by President Cyril Ramaphosa who joined live from US, where it was 5am in Washington. 'This is not an austerity budget,' said Godongwana. He noted that, instead of cutting back severely on expenditure, it increases non-interest expenditure by an average of 5.4% over three years. In real terms, this is 0.8% growth, the Minister said. South Africa's two previous Budget attempts failed to gain approval because of proposed VAT hikes, and markets had been concerned over DA threats to leave the multi-party government. Since then, Cabinet has approved the proposed framework. Economists had called for expenses to be cut as the removal of the March proposal of 0.5 percentage point VAT hike meant that government would have a R75 billion deficit in revenue. As a result of the removal of the proposed VAT increase, 'the expansion of the zero-rated basket, which was included to cushion poorer households from the VAT rate increase, falls away,' said Godongwana. In addition, money flowing in from tax has now been revised down by R61.9 billion over the next three years of the Medium-Term Framework. The National Treasury has proposed allocating an additional R7.5bn over the next three years to increase the effectiveness of the South African Revenue Service in collecting more revenue. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ On Wednesday, Godongwana said the National Budget was a redistributive budget.' It directs 61 cents of every rand of consolidated, non-interest expenditure towards the social wage. This is money that will be spent to fund free basic services like electricity, water, education, healthcare, affordable housing, as well as social grants for those in need,' he said. This budget invests over R1 trillion in critical infrastructure to lift economic growth prospects and improve access to basic services, Godongwana said. He added that this is done without compromising the fiscal strategy of sustainable public finances. However, government has achieved its balancing act by reducing additional spending over the medium term by R68bn. 'Simply put, this means baseline allocations across all spheres of government remain largely unchanged. Instead, the size of the proposed increases to allocations is reduced, in line with what we can afford,' said Godongwana. Economists had been concerned about frontline investment being cut, such as additional teachers and nurses. Godongwana added that the government would continue to pay large amounts to service debt, which would amount to more than R1.3 trillion over the next three years. 'Put differently, this means in 2025/26 alone we are spending around R1.2 billion per day to service our debt,' he said. IOL
TimesLIVE
21-05-2025
- Business
- TimesLIVE
Sars gets R4bn to hire army of debt collectors
Finance minister Enoch Godongwana has allocated R4bn to the South African Revenue Service (Sars) in the current financial year to help it strengthen its capacity to collect more tax revenue. The tax authority will immediately use the money to hire more than 1,000 debt collectors to claw back up to R50bn per year in revenue owed to Sars. Godongwana made the announcement when he tabled the 2025/2026 budget in parliament on Wednesday, his third attempt since February. The two previous budget proposals, the first on February 19 and the second on March 12, were rejected by some ANC ministers, parties in the government of national unity (GNU) including the DA and the Freedom Front Plus, and those outside the GNU including the EFF and MK Party. They had clashed over Godongwana's proposals to raise VAT, since dumped after the DA and the EFF challenged the matter in court. Godongwana's latest budget documents show Sars collected R95bn during the previous financial year of 2024/2025. 'Over the medium term expenditure framework (MTEF) period [of three years], the agency will receive an additional R7.5bn relative to the baseline. Part of the allocation is expected to increase debt collection by R20bn to R50bn per year. 'The potential revenue is not included in the revenue estimates. However, the performance of Sars will be monitored by assessing the change in the amount of cash collected, which will be published monthly.' Godongwana had previously allocated R3.5bn to Sars during the medium budget policy statement in November last year. The allocations will also see Sars investing in new technology, data science and artificial intelligence to beef up its capacity to collect more money. Sars commissioner Edward Kieswetter has previously called on National Treasury to allocate it more resources for it to go after tax dodgers. At a pre-budget briefing, Kieswetter said he would hire up to 1,700 debt collectors to chase billions owed to Sars. 'In April we hired 500. We've used April to train and upskill them. From June 1 we'll bring a further 250 and that takes us to about 750,' Kieswetter said. Sars was aiming to collect at least R120bn in total tax debt in the MTEF period. Less for early retirement spending and defence amid DRC withdrawal Godongwana has reduced allocations to the government's early retirement programme. The early retirement plan is aimed at reducing the number of public servants by encouraging government employees aged 55 and above to retire early without incurring early withdrawal penalties. The early retirement package has been cut from R11bn to R5.5bn from this year up to 2027. 'Discussions with organised labour on the process are under way in the Public Service Co-ordinating Bargaining Council (PSCBC). The allocation will be revisited on the conclusion of the consultations as part of the next budget process, though functions that are not parties to the PSCBC process, such as the department of defence, can proceed with implementation.' Allocations to the department of defence have been cut by R2bn due to the 'expedited schedule for withdrawal' of SANDF troops from the Democratic Republic of the Congo.
TimesLIVE
14-05-2025
- Entertainment
- TimesLIVE
Anant Singh complains to ANC about eThekwini's 'sabotage' of film studios
The ANC in KwaZulu-Natal has vowed to act against eThekwini municipality officials who might be implicated in an apparent sabotage of world-renowned film producer Anant Singh's R7.5bn film studios. Singh acquired the old Natal Command defence force building along the North Beach in 2022 to make an investment of R7.5bn for the development of film and television studios and related sectors in Durban. However, the project has been stalled because the city has not yet installed water and electricity in the building, which Singh had renovated. Instead the city revalued the same property to R1bn, which Singh said was way higher than when he bought the property for R71m in 2022. Singh said this meant he would need to pay higher rates yet the building was unusable because there was no water or electricity. Speaking at the ANC engagement meeting with businesses in Durban on Tuesday, Singh told the ANC leaders that after fighting for more than 20 years to acquire the property, which he eventually received three years ago, he did not understand why eThekwini officials were sabotaging such a huge investment that would create jobs in the city. Singh said he was forced to buy a generator because the city has refused to install electricity, adding that the city has recently demanded more than R400,000 just to install an electricity meter. 'I have already lost two TV shows worth R200m which had to be recorded in Johannesburg because my studios are not yet complete because of eThekwini's inept attitude,' he said. ANC provincial task team convener Jeff Radebe expressed shock that Singh's project had not taken off, promising that the ANC would launch an investigation to find out what was happening. 'We will definitely act against the people in the city that would be found responsible for Singh's project delay,' said Radebe. eThekwini municipality spokesperson Gugu Sisilana said: 'Since the allegations are related to a contractual matter regarding the installation of bulk infrastructure services (water and electricity), legal advice will have to be sought before responding.' Sisilana said a dispute regarding the municipal valuation of the property has been lodged by the property owner. 'However, as this matter is subject to a formal dispute resolution process in terms of the Municipal Property Rates Act, the municipality is not able to comment further at this stage. 'The matter will be adjudicated in accordance with the applicable legal framework,' said Sisilana. She said the municipal leadership has an open-door policy and continues to engage various stakeholders including business leaders on pertinent matters for the benefit of the city and its residents.
