Budget to answer questions about how the Covid vaccine costs South Africa and who pays

Finance Minister Tito Muboweni’s 2021 budget speech should provide full details on the total cost of implementing the Covid-19 vaccine deployment in South Africa, professional services company PwC said.

Given that the country’s earnings outlook has improved, the company said it expects tax increases to be used to cover the cost of vaccines. He added that the government is in talks with health care schemes to raise funds for non-scheme members.

“This is effectively a tax on the health care system and will be indirectly borne by the members of the health care system,” he said.

This is an ideal scenario, but PwC said many analysts have pointed out the possibility of tax increases to fund vaccines.

“I don’t think this is necessary given the significant improvement in revenue outlook in the short to medium term, but it depends heavily on the final clarification cost of vaccine deployment. Includes not only the direct cost of the vaccine itself, but also the cost of implementing the vaccination program. “

Unless the Treasury secures funding from the private sector, PwC said it expects costs to come from existing sources of income or debt.

This can be done by temporarily raising spending caps, prioritizing spending, using reserves, or a combination of all three, he said.

In an interview in January 702Dondo Mogajane, Director of Finance, said South Africa is usually funded by two sources: taxes and market borrowing.

“As you can imagine, neither of the two options is ideal. But at this point we are facing a pandemic and the president is possible to ensure that we find money. I’ve confirmed that I can do anything, “he said.

Mogajane said prioritizing existing budgets is an option. The second option was to borrow more and increase the deficit. The third option was to tax citizens to make up for the shortfall.

He said the official decision would be communicated on February 24 in the budget of Finance Minister Tito Muboweni and will be thoroughly detailed to show where the money is coming from.

Despite financial considerations, the director said the final decision was about saving lives.

“In any case, we have to bite the bullet. We have to do it to save lives with South Africans. Buy these vaccines and ensure that South Africans are vaccinated. To that end, we must do our best. “

read: As the number of immigrants grows, Muboweni becomes “unaware” of South Africa’s shrinking tax base

Budget to answer questions about how the Covid vaccine costs South Africa and who pays

Source link Budget to answer questions about how the Covid vaccine costs South Africa and who pays

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