South Africa: Premier cautiously welcomes

renewable energy tax incentives: Premier cautiously

welcomes tax incentives for businesses &individuals
announced in Budget 2023 to help ease energy
crisis
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Premier Alan Winde cautiously welcomedFinance Minister Enoch Godongwana’s announcement in his budget
speech of tax interventions to encourage businesses and households to turn to renewable energy sources to bolster
renewable power production and ease the energy crisis.
In his speech the Minister outlined two measures:
From 1 March 2023, businesses will be able to reduce their taxable income by 125 percent of the cost of an
investment in renewables. There will be no thresholds on the size of the projects that qualify, and the incentive will
be available for two years to stimulate investment in the short term. Individuals who install rooftop solar panels from
1 March 2023 will be able to claim a rebate of 25 percent of the cost of the panels, up to a maximum of R15 000.
This will only be offered for 1 year.
The Premier pointed out, “This is partly in line with what the Western Cape Government had called for, but we
should have gone further, especially for individuals whose daily lives have been significantly disrupted by relentless
rolling blackouts.”
Premier Winde, however, believes, “The tax incentive for individuals does not go far enough. The rebate should be
higher and should run over a longer period. The energy crisis will be with us for much longer than a year and if we
are to sustain our country’s just energy transition, we must demonstrate a definitive commitment to renewable
energy. The lack of a clear plan to achieve long-term energy resilience remains a deep concern for us.”
He added, “I am encouraged by the Minister acknowledging that the energy crisis is the country’s biggest economic
constraint and that nothing can happen to stimulate economic growth without significant work to resolve this
catastrophe. The Western Cape will be pushing harder for more residents to consider renewable energy and for the
province to become independent of Eskom.”
Western Cape Minister of Finance and Economic Opportunities, Mireille Wenger, said, “While we welcome the
much-needed interventions to enable renewable power generation by citizens in South Africa, I remain concerned
that provincial allocations through the Provincial Equitable Share are well below inflation. This means more pressure
on critical frontline services, such as health, education, and social development.”
Minister Wenger continued, “The fact that South Africa’s debt-servicing costs will increase by 8.9% over the
medium-term, while allocations to provinces will only increase by 2.8% over this same time, demonstrates the
serious consequences of years of mismanagement and corruption.”
Minister Wenger said she was hoping to hear concrete plans on VISA reform, which is severely impeding investment
in South Africa. “The note that South Africa is working to address the VISA backlog is welcomed, but we now need
to match our words with action. A clear deadline is needed for introducing a remote working VISA, with significant
reform of the VISA system required.”

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DETAILS

Business indexing term: Subject: Renewable resources

Subject: Energy shortages; Alternative energy sources; Renewable resources

Location: South Africa

URL: http://www.africa-newsroom.com/press/south-africa-premier-cautiously-welcomes-
renewable-energy-tax-incentives?lang=en

Publication title: African Press Organisation. Database of Press Releases Related to Africa; Lausanne

Publication year: 2023

Publication date: Feb 23, 2023

Publisher: African Press Organization - APO

Place of publication: Lausanne

Country of publication: Switzerland, Lausanne

Publication subject: General Interest Periodicals--Africa

Source type: Wire Feed

Language of publication: English

Document type: News

ProQuest document ID: 2778823745

Document URL: https://www.proquest.com/wire-feeds/south-africa-premier-cautiously-

welcomes/docview/2778823745/se-2?accountid=86413

Copyright: Copyright African Press Organization - APO Feb 23, 2023

Last updated: 2023-02-23

Database: Research Library

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