Thursday, March 4, 2010

Whoo - busy night tonight, but while the going's good, I might as well keep going.

So my last post was on electricity price hikes - another price sensitive issue which" has suddenly gone very quiet by undoubtedly has not disappeared is that of TV licencing.

How many of you have a valid TV licence? I've heard so many different arguments around payment of TV licences - "I don't watch the SABC stations", "I pay my DSTV subscription", "I don't have the time", "It's a waste of money" etc.

Guess what? They're on to you!

How is this for a new method of collecting licence fees - if you don't pay your TV licence, we'll just force you by imposing a new tax. And this means that you cannot shy away from it - if you're a registered Tax payer of course.

So the new licencing option is to impose a 1% tax on all registered tax payers' salary. So let's look at this carefully:

You are the only income earner in your household and you earn R10 000 a month. You will now be taxed 1% on that salary, which equates to R100 - per month. You currently pay around R250 per annum for your TV licence - which if this tax is approved will increase to R1200 per annum. NICE! And if you have 2 income earners (let's say they earn the same salary, for the sake of simplicity) you pay R2400 per annum.

I suppose the SABC has to find some way of paying off it's debts. Pity the financial burden again lies on the shoulders of the responsible tax payer. And those that aren't tax payers - hey don't worry, the tax payers have got it covered!

I really wonder whether this concept is going to fly and long term what the impact is going to be. Would you be happy paying 6 times more for a TV licence that you don't actually use?


A bit off the mark from my usual topics, and I could probably put a techie slant on if I really wanted to, but not going to go there... :-)

As some South Africans are reeling with shock from Nersa's recent announcement on electricity price hikes (an average increase in excess of 20% over the next three years), others are giving a sigh of relief that the price hike is "not what they were asking for".

What is important to note however is that this is the rate at which Eskom makes electricity available to the municipalities who then redistribute (at a cost) to the consumer. These municipalities can then add up to 15.33% to the price that the consumer is then charged in 2010, 16.03% in 2010 and 16.16% in 2012. So an increase that seemed to give the consumer a break, will still be increased in excess of 15% over and above Eskom's increase. The result?

Unless municipalities curb their portion of the increase, the consumer could face an increase almost 10% more than Eskom's original request. Will the municipalities come to the party? Jo'burg have apparently committed to keeping their part of the increase as low as possible - whether this will be the case is another story. And whether the other municipalities will follow suit is something I cannot answer. We will have to wait and see when the price increase actually kicks in. Bear in mind, however, that these are the same municipalities that jumped at the highest possible increase in the last round of price hikes.

It amazes me how we keep talking about making electricity available to the more rural areas as a basic human right, but then we make it so expensive that most people just cannot afford it.