Better days ahead for the poor

Billions are being spent and it is all a little confusing - just who is getting more and who will have to pay more. This is the 2004/5 Budget in easily digestible bits.

Drivers

Petrol and diesel prices will probably go up when the fuel levy is raised by 10c a litre to R1.11 and 95c respectively.

The Road Accident Fund will also go up slightly and this should affect drivers as well.

But farmers, miners and others should get some relief from an increased diesel fuel rebate.

The poor

About R15 billion will be set aside for the job-creating Extended Public Works programme over the next five years. Social spending will rise by R6bn in 2004/5 and provinces are expected to spend R48bn on social grants and welfare services. Disability grants and pensions will increase to a maximum of R740.

About R2.2bn of the total will be spent on the delivery of water and electricity to poorer households.

The rich

Foreign firms will be allowed to list on the South African capital markets and local investors will be able to participate in the listings. African companies listing will get an extra 5% of their total retail assets on the JSE or Bond Exchange.

Smokers and drinkers

As expected, smokers and drinkers face price increases again.

Taxes on a packet of cigarettes will go up by 64 cents.

Tax on a 340ml can of beer will go up by 4.3c and tax on a 750ml bottle of spirits will increase by R1.76, bringing the total tax per bottle to R14.78.

Black empowerment

Provinces get R6m to boost broad-based black empowerment.

The government also plans to encourage the broadening of equity ownership by employees.

Shares to low-income employees at reduced or no cost will not be taxed if they are held for a period of time to facilitate long-term ownership by workers.

Police, correctional services and the judiciary

An additional R1.9bn over the next three years will go towards safety and security.

Police should get additional staff, starting quite soon and the vehicle fleet will be modernised and upgraded.

Court administration will be strengthened using a further R475m.

Attention will be given to providing better services to vulnerable groups, especially woman and children.

Home-owners

The Budget seems to be quite a good one for home-owners. The exemption threshold for transfer duty will be raised to R150 000 and stamp duties on mortgage bonds will also be removed from the beginning of next month. Stamp duty on negotiable certificates of deposit will be repealed in April.

Civil servants

Employees in smaller or formerly disadvantaged municipalities that might have been having a hard time will probably get some relief with the implementation of the Municipal Finance Management Act in the middle of the year. This programme should see financial reforms that will narrow the gap between the rich and poor local governments.

Municipalities will also be able to borrow under the legislation and larger municipalities should start issuing municipal bonds later this year.

There will also be R2.2bn more spent on infrastructure and services.

People with HIV/Aids and other sick people

Over R2bn is allocated for a comprehensive response to HIV and Aids, including the provision for anti-retroviral treatment programmes. Health professionals will get new rural and scarce skills allowances so health services in remote areas could improve.

Students and pupils

Provinces get R910 for the restructuring of universities and technikons and millions will be spent on the upgrading or building schools, textbooks and materials.

Parents

A total of R19.8bn will go to fund the child support grant, increasing it to R170 a month and increased funding for schools.

Developing farmers and small businesses

Through a new grant, R750m will be transferred to provincial agricultural departments for agricultural support but small business didn't get a serious look this time around.

However, task teams will be set up to look at ways of reducing the administrative burden imposed on small business by government regulation.

Individual taxpayers

Workers earning less than R150 000 a year will get some more relief and the threshold for people who do not pay any income taxes rises to R32 222.

For people aged 65 or over, the threshold is raised to R50 000.

The domestic interest and dividend exemption threshold for the elderly will also be raised from R10 000 to R11 000.