Big budget twist, and proposal to scrap Eskom solar fees

The South African rand weakened on Tuesday (1 April) after lawmakers on a parliamentary committee recommended further changes to the country’s budget, adding uncertainty to an already unclear fiscal situation.

The majority of the members of the Standing Committee on Finance, which is the first parliamentary body to review the budget.

The members suggested amending it by removing a proposed 1% VAT increase that was to be implemented over two years and adjusting personal income tax brackets for inflation.

As a result, the rand was trading at 18.40 against the dollar, approximately 0.4% weaker than its previous close.

Trading in the rand is often highly volatile, responding significantly to major local factors, such as budget negotiations, as well as global risk events.

On Wednesday (2 April), the rand was trading at R18.51 to the dollar, R23.92 to the pound and R19.99 to the euro. Oil is trading lower at $74.52 a barrel.

Here are five other news stories making waves in South Africa today:

Budget twist: The ANC has sidelined the DA and secured a majority in the Standing Committee on Finance to adopt the budget framework report, which includes “recommendations” without guarantees. This majority was bolstered by support from the ANC for ActionSA’s proposal to remove the 0.5 percentage-point VAT increase and to fully relieve personal income taxpayers from inflation. [BusinessTech]

Scrap Eskom solar fees: The Minister of Forestry, Fisheries, and the Environment, Dion George, supports Eskom’s decision to waive registration fees and provide free smart meters for residential customers until 31 March 2026. However, he believes that these benefits should become permanent to ensure a true commitment to reducing emissions and transitioning to a low-carbon economy. [MyBroadband]

NHI warning: The National Health Insurance (NHI) Act was “dangerously flawed” and, if implemented, will collapse South Africa’s healthcare system, the SA Medical Association (Sama) said on Tuesday. [Business Live]

Petrol price adjustments: In March, global oil prices fell sharply due to US President Donald Trump’s tariffs and trade wars, while the South African rand remained stable. Fuel prices will be reduced by 58 cents per litre for 93 octane petrol and 72 cents for 95 octane petrol, with diesel prices dropping between 84 and 86 cents per litre, despite a slight tax increase. [BusinessTech]

Government opens door to private sector: Electricity and Energy Minister Kgosientsho Ramokgopa announced on Tuesday that plans are in place to encourage private sector investment in the construction of 1,164 kilometres of electricity transmission lines. This initiative is part of the government’s broader strategy to improve South Africa’s electricity infrastructure and expand the energy grid, addressing the current inadequacies. [Mail & Guardian]