Budget speech 2024 | Government boosts taxes and social spending

Source: eNCAnews

CAPE TOWN - South Africa plans to hike taxes and increase spending on social grants amid sluggish growth and high debt, the government said Wednesday.

The treasury announced increases in income tax as well as alcohol and cigarettes duties as part of a national budget.

"South Africa's economic performance has been weak, and difficult decisions are needed to make sure the economy grows and creates jobs," Finance Minister Enoch Godongwana said.

But the budget also provides more money for social handouts.

WATCH: Discussion | 2024 Budget Speech | Grant increases for recipients

This expenditure will increase by R42-billion over the next three years to keep pace with inflation and increase access for the eligible population, the treasury said.

Almost 20 million people -- about a third of the population -- will receive social grants by March 2027, it said.

The government was sensitive to the increase in the cost of living for the millions of South Africans who rely on these grants to make ends meet, Godongwana told parliament.

Excluding interest payments, about 60 percent of the budget went to fund social services, including public employees' salaries, he said.