Budget Speech 2023

Madam Speaker, the energy and electricity sector, here at home and globally, is undergoing a rapid process of systemic change.

Green technologies are becoming cheaper, and the deployment of low-carbon solutions is accelerating.

We recognise that we have a role to play in encouraging adaptation and mitigation.

I am pleased to announce two tax measures to encourage businesses and individuals to invest in renewable energy and increase electricity generation.

From 1 March 2023, businesses will be able to reduce their taxable income by 125 per cent 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.

As announced by the President, we will also introduce a new tax incentive for individuals to install rooftop solar panels to reduce pressure on the grid and help ease loadshedding.

Individuals who install rooftop solar panels from 1 March 2023 will be able to claim a rebate of 25 per cent of the cost of the panels, up to a maximum of R15 000. This can be used to reduce their tax liability in the 2023/24 tax year. This incentive will be available for one year.

Changes to the Bounce Back Loan Guarantee Scheme are also proposed to incentivize renewable energy, rooftop solar, and address energy-related constraints experienced by small and medium enterprises.

Government will guarantee solar-related loans for small and medium enterprises on a 20 per cent first-loss basis.

National Treasury will launch the Energy Bounce Back Scheme in April 2023.