South African Budget 2021. companies, the Public Investment Corporation and ordinary South African bondholders. News. Madam Speaker, Honourable Members, when the Constitution was adopted 25 years ago, the words “Nothing can stop us now!” resonated in this House. • The 2020 Budget proposes total consolidated spending of R1.95 trillion in 2020/21, with the largest allocations going to learning and culture (R396.4 billion), health (R229.7 billion) and social development (R309.5 billion). Finance Minister Tito Mboweni faces one of the toughest juggling acts of his career when he delivers the 2021 Budget Speech. 2020 Budget Speech Gross national debt is projected to be R3.56 trillion, or 65.6 per cent of GDP by the end of 2020/21. Pre-Budget Commentary. From an economic outlook perspective, the South African economy is expected to rebound by 3.3% from a 7.2% contraction in 2020. The Department of Tourism has reprioritised R540 million over the medium term to establish the Tourism Equity Fund (TEF) as one of the measures to support the tourism sector recovery. 2. Madam Speaker, my second reason for hope stems from a much-improved economic outlook. In our first CLARITY conversation for the year, we look at the clarity South Africa needs from the Minister of Finance’s 2021 Budget Speech. This was DA shadow minister for finance Geordin Hill-Lewis's reaction to finance minister Tito Mboweni's 2021 budget speech in parliament on Wednesday. Read some expert commentary and analysis from Old Mutual. Often, we speak about how we must leave this earth better than we found it for future generations. Highlights of the Budget Speech summarised: A consolidated budget deficit of R370.5 billion, or 6.8% of GDP in 2020/21, is projected. Join the conversation on Twitter #Budget2021 The argument is that the incentive is not achieving the objectives of developing small businesses, generating economic activity and creating jobs. The net impact is … ... on this issue by mid-2021. The NEDLAC constituencies also agreed to accelerate the introduction of auto-enrolment for all employed workers, and the establishment of a fund to cater for workers currently excluded from pension coverage, as an urgent intervention towards a comprehensive social security system. These include foreign investors, pension funds, local and foreign banks, unit trusts, financial corporations, insurance. The urban development zones and learnership tax incentives will be extended for two years while their reviews are completed. Medium Term Spending Plans and Job Creation Madam Speaker, my fourth reason for hope is that this Budget explicitly supports economic transformation and job creation. 24 Feb 2021. It is the most prudent way to achieve higher levels of prosperity and avoid a sovereign debt crisis. This is our first reason for hope. For more news, visit sabcnews.com and also #SABCNews #Coronavirus #COVID19News on Social Media. Focusing on the tax aspects of the budget speech, Treasury is anticipating that tax collections in 2020/21 are expected to be approximately R213 billion less than the prior year forecast, the largest tax shortfall on record. We will give consideration to further rate decreases to make our tax system more attractive. This is however only planned for years of assessment commencing from 1 April 2022. South Africa is benefiting from a commodity price boom. Budget. It is important to understand the context. His speech comes in the wake of shocking unemployment figures that were shared by Stats SA on Tuesday. Customs and excise operations are reducing the illicit movement of goods across borders, assisted by specialised cargo scanners, resulting in 3 393 seizures valued at R1.5 billion for the fiscal year to January 2021. A prosperous future is possible for our beautiful country. The fiscal framework we table today entails the following: Main budget revenue is projected to be R1.35 trillion, or 25.3 per cent as a share of Gross Domestic Product (GDP) in 2021/22. 25 February 2021. We aim to table this reform before Cabinet before the end of this year. In order to improve access to African markets, our six busiest border posts will be upgraded and expanded. It was stated that last year Treasury had outlined a strategy to become a winning country, however this was prior to the widespread Covid-19 pandemic that has destroyed lives, jobs and damaged the economy. These reviews are already underway and will shape this framework. China is expected to grow at 8.1 per cent in 2021, while India will achieve a growth rate of 11.5 per cent in 2021. ... South Africa. Finally, to the millions of South Africans who faced, and continue to face, enormous difficulties and challenges, we ask you to take courage, persevere and walk with us. A total MTEF allocation of R7 billion is made to the Land Bank. Finance Minister Tito Mboweni on Wednesday delivered the R2 trillion 2021 Budget in Parliament Cape Town. In support of these efforts, we request that this House approve an additional spending allocation to SARS of R3 billion over the medium term. But it seems to have happened that we looked at ourselves and said the time had come that we make a super-human effort to be other than human, to respond to the call to create for ourselves a glorious future, to remind ourselves of the Latin saying: Gloria est consequenda - Glory must be sought after!”. The Johannesburg tax team analyses the South African National Budget Speech, delivered on Wednesday 24 February by Finance Minister Tito Mboweni. We owe a lot of people a lot of money. With this framework we provide the budget for South Africa's vaccination campaign. With this framework we are on track to achieve our goal of closing the main budget primary deficit. South Africa 2020/2021 Budget Speech and important changes affecting payroll. There are a number of other aspects covered that we would be welcome to address if you so require. On 24 February, our Finance Minister, Mr Tito Mboweni, delivered the National Budget Speech, outlining the government’s priorities for 2021. The Department of Small Business Development has allocated R4 billion over the medium term to township and rural enterprises, including blended finance initiatives. We also salute the many South Africans who rallied to help others survive. However, all these efforts to expand infrastructure will be wasted if the end user does not pay a cost-reflective tariff for usage. National Budget: Tough decisions may be needed to deal with South Africa’s fiscal crisis. There is a planned review of the nature of long term service awards for fringe benefit purposes. This is after providing for debt-service costs, the contingency reserve and provisional allocations. TAX REVENUE, 2020/21 Personal income tax VAT Corporate income tax Fuel levies Customs and excise duties Other R546.8 bn R360.6 bn R230.2 bn R112.7 bn R91.8 bn R83.4 bn 2020 Budget Highlights Card.indd 1 2020/02/22 09:47 Total consolidated spending amounts to R2 trillion each year over the medium term, the majority of which goes towards social services. My gratitude to the Governor of the South African Reserve Bank Mr. Lesetja Kganyago and the outstanding staff of the Bank. SARS has started to deepen its technology, data and machine learning capability. Summary of the Presentation on the Fiscal Strategy This 2021 budget framework puts South Africa on course to achieve a primary surplus. I would like to take this  opportunity to thank those South Africans who diligently continue to pay their taxes. Introduction. Deloitte Africa Quick Tax Guide 2021/22. Most of that relief will reduce the tax burden on the lower and middle-income households. Conclusion and ThanksMadam Speaker, I thank the President and Deputy President for their courageous leadership during these testing times. Public Procument and Zero-based budgeting Honourable members, our fiscal path requires that we better leverage government’s status as the largest purchaser of goods and services in the economy. According to the International Monetary Fund, GDP growth in Sub-Saharan Africa is forecast to be 3.5% in 2020/21. Consequently, gross loan debt will increase from R3.95 trillion in the current fiscal year to R5.2 trillion in 2023/24. The damage caused by Covid-19 runs deep and we share in the collective pain of many South Africans who have lost their jobs. Please note that the points addressed herein are limited to a summary of the more significant budget highlights and proposals from the 2020 National Budget Speech. The bill addresses fragmentation in procurement legislation. A word of appreciation to the Deputy Minister of Finance, Dr. David Masondo. We agree that tax increases must be kept to a minimum as we stabilise our public finances. It is my singular honour and privilege to present the 2021 Budget. An allocation of R148.1 million is set aside for this purpose. The intention is to produce significantly re-costed budgets from 2022/23. Madam Speaker Mr President. This will be done through spending reviews which have been used internationally to achieve spending efficiencies. 3.1.2. The time for plans, policies and promises is over. The Fiscal FrameworkUnder the leadership of our President, we have crafted a Fiscal Framework that extends support to the economy and public health services in the short- term, while ensuring the sustainability of our public finances in the medium term. Finalisation of the Public Procurement Bill is urgent. I particularly appreciate my colleagues in Cabinet and the wisdom of the Ministers’ Committee on the Budget. Much of this progress was outlined in the State of the Nation Address (SONA). SARS will also expand its specialised audit and investigative skills in the tax and customs areas to focus on abuse of transfer pricing, tax base erosion and tax crime. In 2021/22 government expects to collect R1.37 trillion, provided that the underlying assumptions on the performance of the economy and tax base hold. Real GDP growth in 2021 is expected at 3.3% (ICIB at 3.5%) and CPI inflation at 3.9% (ICIB at 4.4%). 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