REVENUE: The revised estimated tax revenue for 2010/2011 is R658bn, or R69bn less than was budgeted a year ago. But it is still R1,4bn higher than the estimate in the medium-term budget policy statement in October.EXPENDITURE: Government spending in 2010/2011 is budgeted at R907bn, up by 8,6% on the revised estimate of R835bn spent in 2009/2010. This year's spend is estimated at 33,6% of GDP. Annual real growth in public spending over the next two years is about 2%. Reprioritisation of spending towards targeted outcomes, and a savings exercise, are important elements.
BORROWING: With tax revenue falling because of weaker economic conditions, a government deficit equal to 6,2% of GDP is expected in 2010/2011. By 2012/2013, the deficit is expected to reach 4,1%. The public-sector borrowing requirement rises to 11,1% of GDP in 2010/2011, before moderating to 7,1% over the next two years. National government net loan debt is forecast to rise from R526bn at the end of 2008/2009 to R895bn this year and R1,3 trillion in 2012/2013. Foreign debt in 2010/2011 is budgeted at R106bn, or 3,9% of GDP.
PERSONAL TAX: No increase in the overall tax burden this year, and government announced income tax relief of R6,5bn for individuals. This mostly compensates for the effects of inflation and mainly affects taxpayers in lower-income brackets.
ESKOM: In February last year government approved guarantees totalling R176bn to support construction of new power plants. State support has led to the cancellation of an Eskom credit watch and the confirmation of its credit rating by Standard & Poor's.
ECONOMY: Treasury is forecasting GDP growth of 2,3% in 2010, rising to 3,6% by 2012. This follows an estimated decline of 1,8% last year, with about 900 000 job losses.
Gross fixed capital formation is expected to grow this year at 5,8% and strengthen further in 2011. CPI is expected to remain at about 6% in 2010/2011. The current account deficit is forecast at 4,9% of GDP this year, rising to 5,8% by 2012.
DIVISION OF REVENUE: National departments get R359bn in 2010-2011, provinces R323bn, and local government R59bn.
INFRASTRUCTURE: The medium-term R787bn infrastructure spend announced last year has been raised to R845,6bn for the 2010/2011-2012/2013 period. This is made up from the infrastructure budgets of national, provincial and local government departments, and public-private partnerships. Non financial public enterprises, such as Eskom, Transnet and Sanral, make up the largest share, contributing R453,7bn, or 53,6%. Infrastructure spending by municipalities comprises 17,5%.
HEALTH: Public funding for the health sector equates to about 4% of GDP and 14% of the main budget. Public spending on health this year is forecast at R106,5bn, up 6,7% on the estimated R99,8bn in 2009-2010.
DIVIDEND TAX: Most issues relating to the proposed changeover from secondary tax on companies to a dividend tax have been resolved, but some smaller matters are still being discussed, including definitions and transitional procedures.
INTEREST TAX: The annual tax-free interest income rises from R21 000 to R22 300 for individuals below 65 years and from R30 000 to R32 000 for individuals 65 and over.
SIN TAXES: A packet of 20 cigarettes will cost R1,24 more, a 340 m can of beer 6,5c more and a 750 m bottle of wine 12c more.SOCIAL GRANTS: Spending on grants is to increase from 3,2% of GDP before the crisis to 3,5% in 2010-2011. Spending on the old-age grant this year will be R34,1bn.
CHILD SUPPORT: The child support grant is extended to a recipient's 18th birthday. The grant is increased by R10, to R250. Expenditure this year will amount to R30,9bn.
EDUCATION: Spending on education is set to rise by 10,8%, from R148,9bn in 2009-2010 to R165,1bn in 2010-2011. There are special allocations to improve literacy and numeracy, including R2,7bn for workbooks for learners in grades R to nine.
MINING ROYALTIES: These will be levied on minerals disposed of or exported from March 1 2010, and are expected to raise R3,54bn this year.
CRIMINAL JUSTICE: Government spending on public order and safety of R78,4bn in 2009-2010, rises to R85,6bn in 2010-2011. Police staffing levels expand from 185 371 in 2009-2010 to 200 660 in 2012-2013.
EMPLOYMENT: To help tackle youth unemployment, a wage subsidy for young people is proposed. The second phase of the expanded public works programme is designed to increase both job duration and labour intensity of projects. It aims to create 4,5m short-term jobs that last 100 days on average. An estimated R52bn will be spent on the programme over the next three years.
CARBON EMISSIONS TAX: An ad valorem carbon emissions tax on new passenger cars, announced in the 2009 budget, will be converted into a flat-rate emissions tax effective from September 1 2010.
