Large fiscal deficits incurred over the years, although providing short-term support to the economy, have not resulted in commensurate long-term economic growth. This has led to sharp increases in the government’s debt-to-GDP ratio, which currently stands at 60.8 per cent, and is expected to rise to 71.3 per cent in 2022/23. The growing proportion of limited public resources spent on interest payments are crowding out spending on social and economic investment.
In February 2019, the president announced the separation of Eskom into three distinct entities: generation, transmission and distribution. The primary objective being to allow each entity to focus on enhancing efficiency, reducing costs and optimising investment on a specific function, rather than trading off efforts amongst all three. In addition, the capital structure will ultimately be amended to end all reliance of Eskom on government support. Functional separation to wholly owned subsidiaries with independent Boards is scheduled to be complete by March 2020, with legal separation of the distribution and generation functions by December 2021.
Policy certainty and a conducive business environment are critical to support the confidence of businesses and households. A robust monetary policy framework has provided certainty but needs to be complemented with a range of reforms that are within government’s control and do not require significant funding. These would help to raise long-term growth.
The 2019 MTBPS has been presented by Minister Tito Mboweni. His opening statement was a reference to the Aloe Ferox plant he brought to Parliament when presenting the February 2019 budget.
The latest social media phenomenon in South Africa is a Facebook page started just over a month ago which now has 700 000 followers! It’s a collective of positive sentiments about South Africa from people of all walks of life. Now it looks set to play a role in job creation and stimulating the economy. A positive step in any one’s books!
In a very recent public spat, the board of Old Mutual and its CEO have had an acrimonious relationship, with the CEO wanting to declare the entire board of Directors delinquent after having been fired for conflict of interest. Being declared a delinquent director is not a common occurrence and we thought it may well be of interest to list the grounds for Delinquency.
The Minister of Finance, Mr Tito Mboweni, is calling on members of the public to make comments on a paper titled: “Economic transformation, inclusive growth, and competitiveness: Towards an Economic Strategy for South Africa”.
Many may think that they are not old enough or wealthy enough to warrant doing any estate planning. However, if a person is over the age of eighteen, no matter how small their estate is, it is advisable to begin the process. Where an estate planner is “at” in life, will determine your strategic plan for your estate, and which techniques to use in order to implement in the plan. An estate planner may be single, married, divorced, or separated. You may have minor children or adult children. You may be married for a second or third time, with children from previous marriages. You may own assets with a strong growth potential.
Much has been publicised about the potential implementation of prescribed investments and resultant impact on investment returns. This policy was previously followed by the Nationalist Party but abolished in the late 1980’s.
Setting up an Online Store
Did you receive an SMS from SARS showing your tax calculation?
The cabinet has finally approved the National Health Insurance (NHI) bill for tabling in parliament, minister in the presidency for planning, monitoring and evaluation Jackson Mthembu announced last Thursday.
In the current economic climate, more and more companies are becoming financially distressed. Directors are duty bound to constantly monitor the company’s financial position, to determine whether voluntary business rescue proceedings need to be initiated. Failure to implement business rescue proceedings could result in the director being charged with reckless trading and be exposed to personal liability. It is incumbent upon directors to ensure that they place their companies into either business rescue or liquidation, or to cease trading, when the warning signs become evident. Directors should be aware of the practicalities of business rescue, and the duties and powers of the business rescue practitioner.
South Africa's gross domestic product (GDP) growth rate decreased by 3,2% in the first quarter of 2019
Our economy continues to stagnate, and one can only hope that President Ramaphosa’s “new dawn” bears fruit sooner rather than later. Below are some key findings as released by Stats SA.
Take urgent action to combat climate change and its impact.
There is one truth about change: It’s going to happen. Technology, consumer demand, globalization, competition, and the economy—all of these factors contribute to the need for every business to move with the times in order to survive. Companies that want to grow, have to change to remain viable and continue growing. That’s the very nature of growth—it brings about and demands change.
The outcome of the national elections is a clear indication that, while the ANC lost regional support, many voted in effect for Ramaphosa nationally. This gives the President the mandate he requires to put his reformist policies in place.
Recently released, the United Nations’ global assessment of environmental health is grim: biodiversity declining at an unprecedented rate, one million species at risk of extinction, human populations in jeopardy if the trajectory is not reversed.
The carbon tax will be implemented on 1 June 2019. It gives effect to the polluter-pays principle, prices greenhouse gas emissions and aims to ensure that businesses and households take these costs into account in their production, consumption and investment decisions. The tax will assist in reducing emissions and ensuring South Africa meets its commitments under the 2015 Paris Climate Agreement. It will be reviewed after three years.
There has been a lot of banter about Tom Moyane’s time at SARS. The recent SARS commission has highlighted several issues and, in the recent budget, a number of commitments were made in this regard. We summarise these for you below
President Cyril Ramaphosa has appointed Mr Edward Kieswetter as the Commissioner for South African Revenue Service (SARS) with effect from 1 May 2019 for a term of five years.
Tourism is often promoted as one of the key sectors that will drive growth in South Africa. We take a look at an extract from a Stats SA article to get an idea of what tourists spend their money on:
The beginning of a new year is as good a time as any to review your estate plan. More specifically, it is important to make sure all your affairs are in order from an administrative point of view. As part of your estate plan it is important that you make sure that inter alia the following documents are easily available: