Budget speech 2009
Trevor Manuel, the Minister of finance delivered his annual budget speech this afternoon.
Justmoney had a squizz and brings you the broad outline of the speech.
Justmoney will be following the commentary on this speech closely and will bring you our take on the experts take.
Later this week Team Justmoney will be attending the after budget breakdowns and reporting this straight to you.
Here is the basic breakdown of the budget speech.
At the beginning Manuel began by delivering a warning about the outlook for the financial year ahead. He didn't look as grim as the budget went on though. He started by saying that the financial storm that was talked about last year 'has broken', and that the global outlook was extremely dire.
GDP for South Africa was forecast to be 1.2% in 2009.
Real growth over the next three years, however, was expected to be 5.1%. This seems to signal that we will go through a major correction this year but that by the next two years, especially regarding the 2010 World Cup, things will have come properly right again.
The biggest shifts in the budgetary allocations for spending will be for poverty reduction and the main economic policy of government will remain poverty reduction and job creation.
There were a few good signs for consumers, for example it was announced that there would be R 13 billion in personal tax relief allocated this year. But if you are in to your 'sins', the syntax is quite clear, sin taxes will rise.
Beer tax will rise by 7 cents per bottle; wine by 10.5 cents per bottle, cigarettes will draw an extra 88 cents per packet of tax.
There were some green related issues as well.
The tax on plastic shopping bags will rise by 1 cent per packet; this is a great effort that could have been even more. Those packets are polluters and we just don't need them. Another environmentally friendly initiative is that light bulbs will face a large rise in tax, to encourage people to swap over to energy efficient bulbs.
Other good news is that the tax free threshold for personal income has now risen to R 54 200.
Taxes on transport inputs are set to rise with tax on petrol going up by 40.5 cents per litre and diesel to rise by 41.5 cents per litre. All of these tax increases will fund government spending.
R 787 billion has been allocated for infrastructure development over the next three years. Provinces will be allocated R 24.8 billion for service delivery (check the vote winner out!) and social grants will have their budget set at R 12 billion.
These are the bare facts of the budget speech. As the week goes by Justmoney will bring you more in depth coverage and commentary, but in the meantime why don't you do your own budget using our handy planner.
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