Budget Speech Highlights 2025-2026
Promoting economic growth and long term sustenance of public finances
The Honourable Minister of Finance and Economic Development, Hon. Ndaba Gaolatlhe presented the 2025/2026 Budget Proposals to the National Assembly on 3 February 2025.
Budget Focus
The 2025/2026 budget builds on the second Transitional National Development Plan (TNDP) theme, “Towards a High-Income Economy: Transformation Now and Prosperity Tomorrow” and focuses on the following key priorities which are aimed at stimulating growth and creating job opportunities:
▪ Infrastructure Development and Spatial Planning;
▪ Sustaining Livelihoods
▪ Agriculture Development
▪ Supporting the Private Sector through Business Environment Reforms and Value Chain Development
▪ Research and Development
▪ Innovation and Digital Transformation
▪ Green Transition
▪ Education and Human Capital Development
▪ Tourism Development
Economic Indicators
▪ The projected domestic economic growth rates are 4.2% and 5.4% for 2024 and 2025, respectively.
▪ The inflation rate reached 3.5% in December 2023 and is expected to remain within the target range of 3% to 6% over the medium term.
▪ Monetary Policy rate of 2.65% was reduced to 2.4% in December 2023 in response to lower inflationary pressures.
▪ The estimated budget deficit for 2025/2026 is P8.7 billion which is equivalent to 9.3% of GDP.
▪ Preliminary data indicates that in the first 9 months of 2023, an overall balance of payments surplus of P5.1 billion was recorded compared to P5.4 billion in the corresponding period of 2022.
▪ Foreign exchange reserves amounted to P64.9 billion as of 31 October 2023 compared to P60.8 billion during the same period in the prior year.
Fiscal Highlights and Proposals
The Minister outlined the following ongoing measures:
▪ Reviewing fiscal laws to consolidate, simplify and modernise them to deal with the evolving nature of the global business environment.
▪ Introduction of digital tax on electronic transactions.
▪ Implementation of electronic invoicing (EBilling) for efficient VAT collection which is scheduled for completion in December 2025.
▪ Implementation of a "track and trace" solution to mark and track excisable goods by July 2025.
▪ Enhancement of e-services platforms to simplify tax compliance and foster a business-friendly environment.
