National Health Insurance (NHI)
The NHI Bill was recently promulgated amid a mixed reaction sentiment, positive and negative. While one can identify strongly with the rationale, affordability is paramount as is the management of such a fund.
“National Health Insurance is a way of providing good healthcare for all by sharing the money available for healthcare among all our people. The health benefits that you receive will depend on how sick you are, not on how wealthy you are.”
So, the big question is how we fund this. The bill is very thin on the funding model with vague mentions of around 5% of the national wage bill plus zero medical credits going forward. Very simply, it would appear that roughly 20% of the population will fund 100% of the populations baseline health needs. The department of health released the following statement on the funding issue:
“The country has serious budgetary constraints is it not prudent to delay the implementation of the NHI?
The answer is no, and a big no for that matter. Other basic human needs such as water, shelter, sanitation and even food, for that matter, are useless if you are dead. We cannot postpone access to basic human needs… The provision of quality health care should supersede all other needs, because it is about sustaining life. We cannot afford to delay the implementation of the NHI. In fact, when the economic situation in any country is gloomy, that is the time citizens need access to good quality affordable healthcare more than ever before. NHI is intended to provide just that. NHI is not a luxury that can be delayed due to economic circumstances. It is a necessity that is needed to rescue people especially during tough economic times. Otherwise, majority of people will succumb to their ailments due to their weakened economic status which will worsen the country’s economic situation even further.”
We will keep your informed as the funding model becomes clearer going forward.
Is Your Business Sustainable?
Since the 1980’s there has been a global movement towards sustainability and sustainable development – as countries and governments have realised that economic development at the cost of destroying the planet’s natural resources and social equity does not lead to long-lasting prosperity.
The sustainability movement is based on the premise that the development of these 3 aspects:
- the economy
- the environment
- and society
– needs to be balanced, in order for us to find lasting prosperity for future generations on our planet. Sustainability therefore incorporates the idea that we balance the meeting of our own needs without compromising the ability of future generations to meet their own needs.
The sustainability movement has been increasing in momentum over the past number of years – both on a global scale and in South Africa. There have been many positive developments recently – such as the global adoption of the 17 Sustainable Development Goals (UN Agenda 2030), and the Paris Agreement on Climate Change (both of which South Africa is a party to). These international conferences and agreements have underpinned many of the policies and legislation that the South African government has implemented, including proposed legislation in the pipeline. However, in real terms there is still a very long way to go – particularly in relation to what business organisations are doing in regard to sustainable development.
South African Economy – The long Road Ahead
News channels throughout South Africa are bombarding us daily with negative news on the South African economy. While it is pretty much a global issue, our situation is compounded by the ravages of state capture and the abuse of taxpayer’s money. From a global perspective, South Africa is the 67th most competitive nation in the world out of 140 countries ranked in the 2018 edition of the Global Competitiveness Report published by the World Economic Forum. Competitiveness Rank in South Africa averaged 51 from 2007 until 2018, reaching an all-time high of 67 in 2018 and a record low of 35 in 2007.
A Snapshot of the Economy:
GDP: 366.3 billion US dollars (2018)
GDP Growth Rate: – 3.2% q/q (Q1-2019)
PPI: + 5.8 % (y/y June 2019)
CPI: 4.5% (y/y June 2019)
Unemployment: 29% q/q (Q1-2019)
Key industries: Mining (world’s largest producer of platinum and chromium), automobile assembly, metal-working, machinery, textiles, iron, steel, chemicals, fertilizers, foodstuffs, commercial ship repair.
Exports: Gold, minerals, diamonds, platinum, other metals and metal products, foods, automotive components, machinery.
Imports: Machinery (including computers), transport equipment, manufactured goods, chemicals, mineral fuels including oil, scientific instruments, medical apparatus, pharmaceuticals.
Main trading partners: Germany, USA, UK, China, Japan, France, Botswana and Namibia.
Against this negative backdrop, Government has now tabled the NHI Bill. If you are a business owner its time to start sweating your assets and start looking for additional sources of revenue.
If you would like to consult on how to best take your business forward please do not hesitate to contact us for professional advice.
SARS Income Tax Important Dates
There are a number of important submission deadlines over the next few months. Make a note of the following and should you require assistance please do not hesitate to contact us for professional advice.
30-08-2019: PIT Provisional Tax Payments
30-08-2019: CIT Provisional Tax Payments
30-09-2019: PIT top-up Provisional Tax Payments
31-10-2019: Tax Season 2019 Branch filing closes for Individuals
04-12-2019: Tax Season 2019 eFiling closes for Individuals