[WATCH]It will not be easy to fix the economy: Mboweni

SABC News Tito Mboweni P 2 300x169 - [WATCH]It will not be easy to fix the economy: Mboweni

Delivering his Budget Speech in Parliament, Cape Town, on Wednesday, Minister of Finance Tito Mboweni says government has projected a revenue shortfall of R42,8 billion for the 2018/2019 period. This is compared to an estimate of  R27,4 billion in 2018.

He says it’s high time we are frank with the facts and the figures.

Mboweni was at pains to admit that in his oversight role as minister of finance he has had a difficult task to deliver a budget speech that illustrates the nation’s financial situation. However, he has conceded that it is his responsibility to “safeguard the sound financial status of the Republic.”

Mboweni has taken on prudent measures to align the countries finances and has warned South Africa’s that “It will not be easy. There are no quick fixes.”

The 2019 budget has focused, amongst others, on increasing tax collection for the country, however the minister has being dealt the blow of acceding that tax revenue from the South African Revenue Service (SARS) has been revised down by R15.4 billion for 2019.

Mboweni has increased the tax on alcohol and tobacco as well as the fuel levy. Specific excise duties on alcoholic beverages and tobacco products will

increase by between 7.4 and 9%, whilst the the general fuel levy will increase by 15 cents per litre to R3.52 per litre of petrol and to R3.37 per litre of diesel.

  1. The excise duty on a can of beer goes up by 12 cents to R1.74
  2. A 750ml bottle of wine will have an excise duty of R3.15, which is 22 cents more
  3. The duty on a 750ml bottle of sparkling wine goes up by 84 cents to R10.16
  4. The duty on a bottle of whiskey will go up by R4.54 to R65.84
  5. A pack of 20 cigarettes goes up by R1.14 cents to R16.66
  6. The excise duty on a typical cigar will go up by about 64 cents to R7.80
  7. There will be no change to the excise duty on sorghum beer
  8. Fuel levies will increase by 29 cents per litre for petrol and 30 cents per litre for diesel

Mboweni has made no changes to personal income tax brackets. However in trying to increase revenue for the country, treasury will from the 1st of June 2019 introduce a carbon tax. Below-inflation increases in fuel taxes together with the carbon tax on fuel will raise R1.3 billion.

Government has increased its expenditure ceiling is increased by R16 billion over the next three years.  The bulk of spending is allocated to learning and culture, social development, health and community development.

Mboweni has expressed that that, “pro-poor spending continues to grow in real terms.”

The Minister has highlighted that one of the fundamental prescripts of the 2019 budget is to stabilise and reduce government debt.

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