REVENUE: The budgeted revenue from tax for 2009/2010 is R643bn, up by 5,2% from R611bn in 2008/2009. The revenue estimate for last year is being cut by R14,4bn.EXPENDITURE: Total expenditure rises to R739bn, up by 16,5% from last year's estimated R634bn. As a percentage of GDP, spending increases from last year's 27,5% to 29,9%.
BORROWING: Public sector borrowing is expected to increase significantly, moving from a cash surplus of 0,6% of GDP in 2007/2008 to borrowing of 7,5% of GDP by 2009/2010, before moderating to 5,3% by 2011/2012.
Net borrowing by government grows from a negative position to a projected borrowing of R239bn over three years.
The main reasons are the infrastructure investment programme and increased countercyclical government spending in the downturn.
PERSONAL TAX: Adjustments to tax schedules provide relief of R13,6bn to individual taxpayers.
The tax-free income threshold next year will be R54 200 for taxpayers below the age of 65 and R84 200 for those over 65. The Standard Income Tax on Employees system should be discontinued by 2010.
ESKOM: The R60bn support package for Eskom requires repayment of the principal loan with interest.
The interest payments are to be structured flexibly, based on the yield of the R209 bond, plus a margin.
Government will also underwrite Eskom debt of R176bn, consisting of R26bn of existing debt and R150bn in new debt over the next five years.
ECONOMY: Treasury is forecasting GDP growth of 1,2% in 2009, down from 3,1% in 2008. This follows four consecutive years of annual growth of more than 5%. The official growth forecasts for the next two years are 3% in 2010 and 4% in 2011. The current account deficit for 2009 is estimated at 6,3% of GDP, down from 8,1% in 2008 and 7,3% in 2007.
DIVISION OF REVENUE: Provinces this year get R285bn (up from R248bn), local governments R50bn (R47bn) and national departments R343bn (R288bn).
As a percentage of total spending, the biggest increase goes to national departments.
INFRASTRUCTURE: Expenditure plans for public-sector infrastructure over the medium term total R787bn.
Major funding by government includes further allocations to the school building programme, public transport, housing, water and sanitation.
HEALTH: The budget allocates R1,8bn over the medium term to reduce infant and child mortality by introducing three new child vaccines.
An additional R932m is added to the comprehensive HIV and Aids grant. Another R468m goes over the medium term to improve TB treatment and reduce treatment default rates.
DIVIDENDS: The dividend tax at shareholder level, which replaces secondary tax on companies, is likely to take effect in the second half of 2010.
INTEREST TAX: The tax-free interest income ceiling rises from R19 000 to R21 000 for people younger than 65 and from R27 500 to R30 000 for people over 65.
SIN TAXES: Cigarettes go up by 88c for a pack of 20; beer by 7c/can; wine 10,5c/bottle; and whisky 321c/bottle.
SOCIAL GRANTS: Spending on social protection has increased from R72,3bn in 2005/2006, or 4,6% of GDP, to a forecast R118bn in 2009/2010 (4,8% of GDP). The budget adds R13,2bn to the social grants programme.
The maximum values of the old age, disability and care dependency grants will rise by R50 to R101/ month, the foster care grant will increase to R680 and child support will rise to R240/ month.
CHILD SUPPORT: The household income level for the child support grant has been raised to R27 600/ year, and the previous separate urban and rural thresholds have been removed.
EDUCATION: Spending on education by government has grown by an annual 14% for the past three years and is forecast to grow by 10% annually over the next three years.
Key priorities include extending the no-fee schools policy to 60% of schools, from 40% now. An additional R700m goes to higher education subsidies to cater for increases in university costs and enrolments.
MINING ROYALTIES: The mining royalties regime is deferred from this year to 2010, providing a boost to the industry of about R1,8bn.
LAND REFORM: The budget for land reform and land restitution over the next three years totals R20,3bn.
CRIMINAL JUSTICE: Justice and protection services (including prisons, defence, justice and police) are to receive R101bn in 2009/2010, up by 12,5% from an estimated R90bn last year.
An additional R750m is to be spent on increasing the number of police officials from 183 180 in 2008/2009 to 204 860 in 2011/2012, with emphasis on bolstering detective and forensic capacity.
VAT: In a boon for small business, the threshold on value-added tax will increase to R1m from R300 000 as of March 1.
