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Government resolute to protect the economy amid tax pressures

Government resolute to protect the economy amid tax pressures

As South Africa faces rising tax pressures and energy costs, Deputy Minister of Electricity and Energy, Samantha Graham-Maré has reassured businesses and citizens that the government is working hard to protect jobs and drive economic growth in the face of these new challenges.

“With coal still powering nearly 80% of our electricity, the upcoming Scope 2 tax on indirect emissions and the European Union’s Carbon Border Adjustment Mechanism (CBAM) threaten to raise costs for businesses and put R52.4 billion in exports at risk,” the Ministry of Electricity and Energy said on Monday.

By 2034, South African companies could face up to a 60% increase in electricity costs due to these new carbon taxes, with rates expected to jump from R190 to R462 per tonne by 2030. 

As current tax allowances are gradually phased out, some industries may see an overwhelming 340% increase in carbon tax payments. However, there is a path forward to secure jobs and promote growth.

The Deputy Minister emphasised that now is the time to invest in cleaner, cost-effective energy sources to build a more resilient, sustainable economy for all South Africans.

“Our priority is protecting jobs and strengthening our economy. By embracing renewable energy, we’re not only reducing emissions but creating new opportunities for growth, securing our industries’ future, and keeping South African businesses competitive in a global market that values sustainability. Transitioning to cleaner energy is essential for maintaining profitability and creating a brighter future,” Graham- Maré said.

The Ministry has assured business that government stands ready to work with it to unlock the potential of renewables, helping reduce dependence on coal, stabilise energy prices, and secure a prosperous future for South African workers and families.

“Together, we can protect jobs, build resilience, and pave the way for sustainable economic growth. Energy efficiency means job creation,” the Ministry said. –SAnews.gov.za

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Tue, 12/03/2024 – 09:28

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Tuesday, December 3, 2024

As South Africa faces rising tax pressures and energy costs, Deputy Minister of Electricity and Energy, Samantha Graham-Maré has reassured businesses and citizens that the government is working hard to protect jobs and drive economic growth in the face of these new challenges.

“With coal still powering nearly 80% of our electricity, the upcoming Scope 2 tax on indirect emissions and the European Union’s Carbon Border Adjustment Mechanism (CBAM) threaten to raise costs for businesses and put R52.4 billion in exports at risk,” the Ministry of Electricity and Energy said on Monday.

By 2034, South African companies could face up to a 60% increase in electricity costs due to these new carbon taxes, with rates expected to jump from R190 to R462 per tonne by 2030. 

As current tax allowances are gradually phased out, some industries may see an overwhelming 340% increase in carbon tax payments. However, there is a path forward to secure jobs and promote growth.

The Deputy Minister emphasised that now is the time to invest in cleaner, cost-effective energy sources to build a more resilient, sustainable economy for all South Africans.

“Our priority is protecting jobs and strengthening our economy. By embracing renewable energy, we’re not only reducing emissions but creating new opportunities for growth, securing our industries’ future, and keeping South African businesses competitive in a global market that values sustainability. Transitioning to cleaner energy is essential for maintaining profitability and creating a brighter future,” Graham- Maré said.

The Ministry has assured business that government stands ready to work with it to unlock the potential of renewables, helping reduce dependence on coal, stabilise energy prices, and secure a prosperous future for South African workers and families.

“Together, we can protect jobs, build resilience, and pave the way for sustainable economic growth. Energy efficiency means job creation,” the Ministry said. –SAnews.gov.za

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