BUDGET 2018 HIGHLIGHTS
- - As per National Treasury Website
- Feb 22, 2018
- 2 min read
BUDGET FRAMEWORK:
The budget deficit is projected to narrow from 4.3 per cent of GDP in 2017/18 to 3.5 per cent in 2020/21.
Main budget non-interest expenditure is projected to remain stable at 26.6 per cent of GDP between 2017/18 and 2020/21.
Net debt is expected to stabilise at 53.2 per cent of GDP in 2023/24. • Proposed tax measures will raise an additional R36 billion in 2018/19.
The fiscal framework reflects two major changes that followed the 2017 MTBPS: medium term expenditure cuts identified by a Cabinet subcommittee amounting to R85 billion, and an additional allocation of R57 billion for fee-free higher education and training.
Contingency reserves have been revised upwards to R26 billion over the next three years.
Real growth in non-interest expenditure will average 1.8 per cent over the next three years. Post-school education and training is the fastest-growing category
SPENDING PROGRAMMES
Over the next three years, government will spend:
R528.4 billion on social grants.
In total, R324 billion is provided for higher education and training, including R57 billion of new allocations for fee-free higher education and training.
R792 billion on basic education, including R35 billion for infrastructure, and R15.3 billion for learner and teacher support materials, including ICT.
R667.8 billion on health, with R66.4 billion on the HIV, AIDS and TB conditional grant.
R123.3 billion on subsidised public housing.
R125.8 billion on water infrastructure and services.
R207.4 billion on transfers of the local government equitable share to provide basic services to poor households.
R129.2 billion to support affordable public transport
TAX PROPOSALS
In 2018/19:
The VAT rate will increase from 14 to 15 per cent from 1 April 2018.
R6.8 billion will be raised from partial relief for bracket creep.
Increases in the general fuel levy and alcohol and tobacco excise duties will together raise revenue of R2.6 billion. Ad valorem excise duties for luxury goods, such as motor vehicles, will be increased.
Estates above R30 million will now be taxed at a rate of 25 per cent.
The plastic bag levy, motor vehicle emissions tax and the levy on incandescent light bulbs will be raised to promote eco-friendly choices. A health promotion levy, which taxes sugary beverages, will be implemented from 1 April 2018.
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