Given the commitment to fiscal consolidation, tax increases of R40bn will be necessary over the next four fiscal years. Taxes are set to increase by R5bn in 2021/2022, R10bn in 2022/23 and R15bn in 2024/2025. The most effective taxes to increase would be personal income tax, which contributes 30% to government revenue and VAT which contributes approximately 25%. Other forms of taxes could also be implemented such as a wealth tax, which would be politically palatable, but can be difficult to implement. A three-year solidarity tax on high-income earners has also been mooted to help pay for the Covid-19 crisis. New tax policies will be announced in the February 2021 Budget.
Minister of Finance Tito Mboweni’s postponed 2020 Medium Term Budget Policy Statement (MTBPS) confirmed expectations that the mini-budget would skirt structural reforms to both bolster economic growth and create jobs.
Below are 10 take-aways from yesterday’s speech:
* Five-year fiscal consolidation pathway to promote economic growth and contain debt and stabilise the ratio of debt-to-GDP at around 95%.
* Gross debt will rise from roughly R4 trillion this year to R5.5 trillion in 2023/24.
* R6.2 trillion spend over the 2021 MTEF which R1.2 trillion will go to learning and culture, R978 billion to social development and R724 billion to health.* Economy forecast to grow by 3.3% in 2021, 1.7% in 2022 and 1.5% in 2023.
* Municipalities to buy electricity from different sources,
* R6.7 billion for the Social Housing Programme aimed at poor, working South Africans.
* A Student Housing Programme (R96 billion) to service nearly 300 000 students a year.
* Regulation 28 to be reviewed and for retirement funds to increase investment in infrastructure,.
* R23bn allocated to Eskom.
* R6.5bn allocated to SAA to settle debt and interest and R10.5 billion to implement its business rescue plan.
Bwanya v Master of the High Court, Cape Town and Others  ZAWCHC 111
The applicant (B) and R met in February 2014 and they started living together in his house in June 2014. The undisputed evidence before the court was that R treated B as his wife. To friends, with whom they mixed socially, their relationship at all times appeared to be that of a loving couple.
R made several preparations for the two of them to travel to Zimbabwe to meet B’s family, negotiate lobola and prepare for a wedding. R died unexpectedly in April 2016. B lodged claims against the estate as intestate heir as R’s spouse, and under section 2 of the Maintenance of Surviving Spouses Act, 27 of 1990 (MSSA).
The second respondent, the executor of R’s estate, rejected both claims, which rejections were upheld by the Master. This led to B bringing the application that both section 1(1) of the Intestate Succession Act, 81 of 1987 (ISA), and certain provisions of the MSSA are unconstitutional and invalid.
The court (Magona AJ) dealt firstly with section 35(10) of the Administration of Estates Act, 66 of 1965 (AEA) which requires aggrieved parties to lodge an application to review the Master’s decision within thirty days. The court held that this is not a term after which the aggrieved party’s right to bring the application will expire, but merely a time period after which the applicant must seek condonation for the late filing of the application.
The court considered the anomaly that arose in South African law after the decision of the Constitutional Court in Gory v Kolver NO and Others  ZACC 20 in that life partners in a permanent same-sex relationship are regarded as spouses for purposes of section 1 of the ISA, but not life partners in a permanent opposite-sex relationship.
The court held that this constituted unfair discrimination on the basis of gender and sexual orientation and that it is presumed to be unfair under section 9 of the Constitution, 1996. The court found nothing to support a finding that the discrimination is nonetheless fair in the circumstances and ruled that section 1(1) should therefore be read to include the words “or a partner in a permanent opposite-sex life partnership in which the partners had undertaken reciprocal duties of support’ after the word “spouse” wherever it appears. The court also held that as it stands, section 1(1) also impairs the dignity of such an opposite-sex life partner.
Dealing with the MSSA, the court held that it is bound by the precedent set by the Constitutional Court in Volks NO v Robinson and Others  ZACC 2 in which the latter court held that the limitation of a claim under the MSSA to cases where a legal duty of maintenance existed is not unconstitutional.
The court ordered the Minister of Justice (the third respondent) to pay the costs of the application.
The judgement of Magona AJ is now subject to confirmation by the Constitutional Court under section 172(2)(a) of the Constitution.
It would be surprising if the Constitutional Court does not confirm this judgement
A properly executed will is always extremely important, and would have avoided the necessity for a court application in the present case.
It has been a volatile week on the global markets, due particularly to Tech stock taking quite a knock and vaccine trials having stumbled a bit.
Court case – Testator’s soundness of mind Vermaak NO and Another v Jacobs and Others  ZAGPJHC 346 The first plaintiff (V) took over as executor of the deceased estate of L from the second plaintiff’s (E) husband (P), after P passed away. L made a joint will with her husband, G in 2005. G died later in 2005. L then executed a will in March 2010, and again in October 2014. She passed away in December 2014. P initiated the litigation and applied to the court for an order declaring which one of the three wills should be given effect to, as the different heirs and legatees held different views as to L’s state of mind when she executed the wills. Due to the material differences the matter was referred to trial. When the trial commenced, all parties accepted that the 2014 will cannot stand as it was by then clear that L suffered from dementia and was already unsound of mind at the time of its execution. The first defendant (J) was adamant that L was already unsound of mind in 2010, and held the view that the 2005 will would be the last validly executed will. The third (S) and fourth (Z) defendants held the view that L was sound of mind when she executed the 2010 will. The court (Sutherland J) applied the provisions of section 4 of the Wills Act, 7 of 1953, that any person who alleges that a testator was not mentally capable of executing a will is faced with the onus of proving that. Proof of the incapability must be on a balance of probabilities. Expert witnesses give their expert opinions, but the court must evaluate their evidence together with that of any other witnesses to reach a factual finding. After weighing the evidence of two experts, as well as the evidence of J, Z, L’s physician, a friend of L, and two domestic helpers, the court concluded that there is nothing of substance supporting the allegation by J that L was already unsound of mind in 2010. The court held that the 2010 will is therefore L’s last valid will.