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NAAMSA MEDIA RELEASE ON THE
2007/2008 BUDGET:
FOR IMMEDIATE RELEASE
Commenting on the
budget proposals announced today by the Minister of Finance, Mr Trevor
Manuel, in Parliament - the President of the National Association of
Automobile Manufacturers of South Africa (NAAMSA), Dr Johan van Zyl,
commended the Minister on announcing a balanced budget that would support
the attainment, over the medium to long term, of higher economic growth in
South Africa. The budget proposals correctly focussed on the supply side
of the economy and should positively influence business confidence and
investment in South Africa.
Specifically,
government's expenditure priorities appropriately targeted infrastructure
development and expansion and the need to modernise South Africa's public
services and improve its effectiveness and overall service delivery.
Specifically, on behalf of the South African automotive industry, Dr van Zyl
welcomed the Minister's emphasis on the importance of expanding and
upgrading municipal transport and roads infrastructure in the run up to
2010. In particular, the development of rapid bus transport projects in
South Africa's major cities as a means of improving public transport - was
consistent with international best practice.
The exceptionally
favourable position of government's finances had enabled the Minister to
introduce significantly increased funding for a broad range of social
priorities whilst, at the same time, granting personal income tax relief to
the extent of R8,4 billion. Moreover, the relief granted was also intended
to partially offset the effect of the recent, fairly punitive changes to the
taxation of medical aid contributions and car allowances. NAAMSA had
previously registered concern about the full effects of the changes to the
car allowance taxation provisions and its impact on vehicle purchasing
decisions in South Africa. The elimination of tax on retirement funds was
also positive and should boost savings for retirement.
In summary, the
budget would place South Africa on a higher growth path and was consistent
with the objective of stability and predictability in government policy.
Overall, the proposals would stimulate investment, economic growth,
development, employment and sustain consumer expenditure. The budget should
be well received by the business community generally.
NAAMSA OFFICES: PRETORIA
21st February, 2007
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