Budget2023 | This year's National Budget, delivered on Wednesday, was dominated by SA's power woes, with Finance Minister Enoch Godongwana announcing that government will take over a large part of Eskom's debt. | News24_Business
This year's Budget is dominated by the electricity crisis, with government announcing that it will take on R254 billion of Eskom's debt.While the Budget showed progress in tackling SA's government debt, storm clouds are gathering.This year's National Budget, delivered on Wednesday, was dominated by South Africa's power woes, with Finance Minister Enoch Godongwana announcing that government will take over a large part of Eskom's debt.
This will help the government's budget deficit to decline from 4.6% of GDP in 2021/22 to 4.2% this year. Next year, it's expected to narrow to 4% of GDP, the lowest since 2019/20.However, its total debt has now reached almost R5 trillion – while it earns less than R1.7 trillion in tax a year. The cost of paying off its debt has ballooned to more than R360 billion a year. Some 18% of all government revenue is now spent on debt repayments, and that will increase to almost 20% by 2025/26.
Government will take now on R254 billion of Eskom's R400 billion debt over the next three years. Some R184 billion will be paid directly to Eskom over the next three years, to settle loans. In 2025/26, government will take over R70 billion of Eskom's loans. "An unbudgeted wage settlement will require very significant trade-offs in government spending," Godongwana warned.
Households will get a tax rebate of 25% of the cost of new solar PV panels for the next year. The rebate can offset your income tax liability up to a maximum of R15 000. For example, if you buy 10 solar panels at a cost of R40 000, this means your personal income tax liability for the 2023/24 tax year will be reduced by R10 000.
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