Tito Mboweni gives first budget speech since taking over as minister of finance.

Finance Minister Tito Mboweni

Finance Minister Tito Mboweni gave his first Budget Speech since taking over minister of the department on the 9th of October 2018 where he promised to be faithful to the people of the country and obey the Constitution of South Africa.

Among other key factors Minister Mboweni said his budget is built on 6 fundamental prescripts:

⚫ Achieving a higher rate of Economic Growth
⚫ Increasing Tax Collection
⚫ Reasonable, affordable expenditure
⚫ Stabilizing and Reducing the National Debt
⚫ Re-configuring state owned Enterprises
⚫ Managing the public sector wage bill

This year Tax Revenue has been revised down by R15.4 Billion Rand compared to last year’s October’s estimate due higher than expected VAT refunds.

Minister Mboweni said that a new Commissioner for South African Revenue Services (SARS) will be appointed in the upcoming weeks and a new illicit Economy Unit that was launched in August last year will fight the trade in illicit cigarette and tobacco.

When he reached the most interesting part of the budget, he said a can of beer will go up by twelve cents to R1,74, 750ml bottle of Wine will go by R3,15 which is 22 cents more while a bottle of whisky will go up by R4,54 to R65,84.

A pack of 20 cigarettes goes up by R1,14 to R16,66, the excise duty on a typical cigar goes up by about 64 cents to R7,80 he said.

He jokingly said there will be no change on sorghum beer a retirement present to IFP leader Dr Mangosuthu Buthelezi and that hon. Buthelezi used to stand when former minister of finance Trevor Manuel made this announcement.

Mboweni further stated that fuel levies will increase by 29 cents per litre, for petrol and 30 cents per litre for diesel.

He urged the Road Accident Fund department to quickly submit the accident benefit scheme bill for parliament’s urgent consideration in order to help stabilize fuel prices.

He further told the house that SOE’s pose a very serious risk to the physical frame work; funding requests from SAA, SABC, Denel, Eskom and other financially challenged state-owned enterprises have increased. With several requesting state support in order to continue operating.

This follows President Cyril Ramaphosa’s clear and executable plan announced in the State of the Nation Address, stating that Eskom would be divide into 3 subdivision components, to allow for more competition and transparency.

When speaking about the other state-owned enterprises he said they are currently reviewing their frame work on how to support them.

He said in the fight against poverty and inequality, Government has allocated R567 billion for social grant payments. In 2019, the grant values will increase as follows:

⚫ Eighty rand increase for old age, disability, war veterans and care dependency grants.

⚫ Forty rand increase for the foster care grant to R1 000.

⚫ The child support grant will increase to R420 in April and to R430 in October.

Minister Mboweni concluded his speech by assuring South Africans that they are taking tough steps to fix the fiscal position and state-owned enterprises.