The 2008 budget takes concrete steps to protect the environment. The biodiesel fuel tax concession was raised from 40% to 50%. Bioethanol will remain outside the fuel tax net although it’s subject to VAT at the standard rate. Government’s biofuel industrial strategy, approved by Cabinet in December, aims to see biofuel make up 2% (or 400 million litres/year) of SA’s national liquid fuel supply over the next five years.
Manuel also set aside R2 billion over the next three years to support programmes aimed at encouraging more efficient use of electricity, generation from renewable sources, installation of electricity-saving devices and cogeneration projects. “We have an opportunity over the decade ahead, to shift the structure of our economy towards greater energy efficiency and more responsible use of our natural resources and expertise,” he said, adding that calls for government to offer financial assistance in purchasing generators needed careful consideration as subsidising fossil-fuel-burning generators would send the wrong signal in light of environmental considerations.
“SA’s economic growth over the next decade and beyond can’t be built on the same principles and technologies, the same energy systems and the same transport modes, as the country is familiar with today,” Manuel said. As a first step towards appropriately targeted fiscal environmental measures, Manuel announced that a new levy of 2c/kWh (kilowatt hour) on electricity generated from non-renewable sources would be introduced in 2008. Rather than introducing it as the first tax that could reduce carbon emissions, he billed it as a measure to support “the required demand-side response to power supply shortages”. The tax will be collected at source from the electricity generator. To boost conservation efforts by private landowners, Manuel said Treasury was considering tax relief for those who preserved habitats and biodiversity, provided they had an approved conservation management plan, drawn up in terms of either the National Biodiversity Act or the Protected Areas Act. Manuel also counted the cost to the environment of tabling the budget.
“The National Treasury’s work has caused 38 000kg of carbon dioxide emissions. We have used over 37t of paper, the equivalent of 726 trees. I am pleased to report the budget documents are printed on a paper called Triple Green, which is chlorine free and biodegradable, consists of 60% sugarcane fibre and meets the standard of sustainable forestation. This is a start, but we need to know more.” – Robyn Joubert