No decision yet on carbon tax — Gordhan
28 June 2012
Posted by: SAIT Technical
By Mariam Isa (Business Day)
Finance Minister Pravin Gordhan says there has been no decision yet on a carbon tax for South Africa.
"We have had a number of engagements with different stakeholders and will continue to have engagements. There is no decision yet on the carbon tax. We are listening very carefully,” he told a breakfast event organised by the Progressive Business Forum on the sidelines of the African National Congress (ANC) policy conference on Wednesday.
Finance Minister Pravin Gordhan said in February that the government wanted to introduce a carbon tax in 2013-14, in a move to reduce greenhouse gas emissions.
Documents released with Mr Gordhan's budget proposed a tax of R120 a ton of carbon dioxide equivalent over a tax-free threshold of 60%, with additional concessions for process (manufacturing) emissions and for trade- exposed sectors.
The World Wildlife Fund (WWF) subsequently said the introduction of a tax as a carbon-pricing mechanism could shift the tax base away from household income and spending: "The introduction of a carbon tax would make polluters responsible for the external costs of their activities, which have previously been subsidised by government.”
Tax consultant Trevor Baptiste said: "Currently, business is concerned about the carbon tax proposal, fearing it could negatively affect them.”
Mr Gordhan also said on Wednesday morning that the problems in the global economy were affecting South Africa and there were "downside risks” to its growth prospects.
He said the rand had been tracking the euro, but lower oil prices had "significantly mitigated” its depreciation. The good side was that exporters in South Africa were in a much more competitive position.
Mr Gordhan said the level of savings in South Africa made it dependent on foreign savings to balance its books overall. A lot more needed to be done to promote savings in the South African context.
"From a Treasury point of view we are putting proposals in place to increase savings,” he said.