4 months ago
MBOWENI GUNS FOR BEER AND CIGARETTE PRICES!
CAPE TOWN, SOUTH AFRICA ? FEBRUARY 20: Finance min
CAPE TOWN, SOUTH AFRICA ? FEBRUARY 20: Finance minister Tito Mboweni at the press conference before he delivers his 2019 budget speech in Parliament on February 20, 2019 in Cape Town, South Africa. Mboweni, a former SA Reserve Bank governor delivered his first annual budget speech as minister of Finance amid socio-economic and political issues in the country. (Photo by Gallo Images)  ~ 

Delivering his maiden budget speech Finance Minister Tito Mboweni made it clear that excise duties on alcohol and tobacco would be going up.

Mboweni said a can of beer will go up by 12 cents to R1.74, and a 750ml bottle of wine will have an excise duty of R3.15, which is 22 cents more.

According to the minister 750ml bottle of sparkling wine will go up by 84 cents to R10.16, while a bottle of whiskey will go up by R4.54 to R65.84.

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

He however, said there will be no change to the excise duty on sorghum beer.

On the price of fuel, he said the levies will increase by 29 cents per litre for petrol and 30 cents per litre for diesel.

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Budget 2019

“Since October, government has taken steps to adjust baseline expenditure downwards by a total of R50.3 billion over the medium term. Half of these reductions come from government spending on compensation,” Mboweni said.

The minister said the State Owned Enterprises (SOE) pose a very serious risk to the fiscal framework: “Funding requests from SAA, SABC, Denel, Eskom and other financially challenged SOE’s have increased with several requesting state support to continue operating.”

“Isn’t it about time that we ask ourselves the question, do we still need all these enterprises? If we do, can we manage them better? If we don’t need them what should we do?” the minister asked.

Mboweni suggested that President Cyril Ramaphosa’s plan to split Eskom into three independent entities would set the electricity market on a new trajectory, which will allow for more competition, transparency and a more focused funding margin.

He said that pouring more money into Eskom is not sustainable.

“I want to make it clear: the national government is not taking on Eskom’s debt. Eskom took on the debt. It must ultimately repay it. We are setting aside R23 billion a year to financially support Eskom during its reconfiguration.”

“The fiscal support is conditional on an independent Chief Reorganisation Officer (CRO) being jointly appointed by the Ministers of Finance and Public Enterprises with the explicit mandate of delivering on the recommendations of the Presidential Task Team. We will make announcements in this regard in the coming weeks,” Mboweni said.

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