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Power levy less for households
26/02/2008 20:09 - (SA)
Cape Town - Household consumers will not be as heavily hit as industrial users by the proposed "green" levy on electricity, head of tax policy in the National Treasury, Ismail Momoniat, said on Tuesday.
He was elaborating on the announcement last week by Finance Minister Trevor Manuel that a 2c per kilowatt-hour levy would be introduced this year on the sale of electricity generated from non-renewable sources.
Momoniat told Sapa that "big" users of electricity paid 15c to 20c per kWh, while domestic users paid over 40c.
The levy would be a "very small percentage" for someone who was already paying 40c.
Manuel told parliament when he made the announcement that he hoped people would "succeed in avoiding the tax", and that households and businesses who reduced consumption by ten percent or more would find that the levy did not affect their monthly costs.
Momoniat said this did not mean someone would be exempt from the levy if they saved electricity.
It meant that by reducing consumption, they could keep their overall bill more or less at the same level as before the introduction of the tax.
"We are hoping people will use less and pay less," he said.
He said the implementation of the levy would depend on parliamentary approval of a revenue laws amendment bill to be tabled in mid-year.
The Treasury was anticipating the levy being in operation only for the last six months of the 2008/9 financial year.
According to Manuel, that will bring in about R2bn, rising to R4bn for the following full financial year.
Momoniat said though the levy, like all other tax policy, had not been discussed with industry and other roleplayers before last week's budget announcement, they and members of the public would have an opportunity to comment when the bill was published and when it went before parliament.
He said the 2c would go into the general revenue pool, and would only indirectly help fund government's R60bn loan to Eskom, which was also announced by Manuel.
- Sapa
- SAPA
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