Finance Minister Enoch Godongwana delivered the 2026 Budget speech at the Nieuwmeester Dome, Parliamentary Precinct in Cape Town, outlining key economic priorities, tax adjustments, and social spending aimed at easing costs and supporting growth for South Africans. Full speech here.
“This Budget reflects our shared journey and the belief that together we can build a more equal, more prosperous economy,” Godongwana told Parliament.
Despite past challenges—including the fallout from state capture, global economic shocks, and public debt pressures—South Africa is showing signs of stability. Debt will stabilize for the first time in 17 years, and borrowing costs are easing, freeing resources for growth and public investment.
The Budget builds on last year’s measures, following 2025 SASSA increases and economic relief strategies. For readers who want full background on grant increases and fiscal changes, see confirmed 2026 SASSA increases.
Here are 8 key ways South Africans can benefit from the 2026 Budget Speech:
1. Tax Relief for households and small businesses
Thanks to higher-than-expected revenue in 2025, the government scrapped a planned R20 billion tax increase. Key measures include:
- Personal income tax brackets and rebates now fully adjusted for inflation, preventing hidden tax increases.
- VAT registration threshold for small businesses rises from R1 million to R2.3 million.
- Capital gains tax exemptions for older business owners increase to support small business sales.
Georgina Lefifi, small business owner from Gauteng at Bonisiwe Consulting, praised the VAT adjustment:
“The new R2.3 million threshold finally reflects the realities of running a small business.”
2. Fuel and carbon levy increases
Fuel levies rise in line with inflation:
- Petrol: +9 cents per litre
- Diesel: +8 cents per litre
- Carbon levy: petrol 19 c/l, diesel 23 c/l
- Road Accident Fund levy: +7 c/l
Excise duties on alcohol and tobacco also increase modestly to reflect inflation. According to the latest consumer price data, inflation is running at about 3.5% nationally, which helps explain why these adjustments are calibrated carefully.
👉 See the latest South Africa consumer inflation report.
These small increases are manageable and predictable, helping households and businesses plan for cost changes.
3. Encouraging savings and retirement
Budget 2026 encourages financial security:
- Tax-free savings account (TFSA) annual limit rises from R36,000 to R46,000
- Retirement fund deduction limit increases from R350,000 to R430,000
This allows South Africans to invest more tax-free, building long-term savings.
4. Social grants and public services
Budget 2026 continues to provide strong support for households:
- Old age, disability, and care dependency grants: +R80, now R2,400
- Foster care grant: up to R1,300
- Child support grant: +R20, now R580
Around 60% of non-interest government spending is allocated to education, healthcare, and social protection, ensuring millions of South Africans benefit from essential public services.
5. Economic growth and debt management
The economy is projected to grow 1.6% in 2026, up from 1.4% in 2025. Debt as a share of GDP is expected to fall to 77.3% in 2026/27 and further to 76.5% by 2028/29.
- Budget deficit: 4% of GDP in 2026, narrowing to 3.1% by 2028/29
- Primary surplus: 0.9% of GDP in 2025/26, expected to rise over the next three years.
Fiscal discipline and stable borrowing costs are expected to free up resources for investment in infrastructure and social priorities without overburdening taxpayers.
Previous 2025 budget overview.
6. Investments in infrastructure and jobs
Public infrastructure spending will exceed R1 trillion over the medium term, including:
- Roads, transport, and logistics projects
- Bulk water and energy infrastructure
- Public-private partnerships (PPPs) to fast-track critical projects
These investments are expected to improve service delivery, create jobs, and stimulate economic growth.
7. Financial sector reforms and innovation
National Treasury is modernizing payments and financial services, including:
- Regulation of crypto assets in cross-border capital flows
- Establishment of a Payments Utility to streamline digital transactions
- Encouraging domestic and regional investment through easier capital flows
Exactly — if we remove the standalone Support for Small Businesses section (originally section 4), we now only have 7 points. We need to replace it with a new 8th point so the article still lists “8 big wins.”
Here’s a suggestion for a new, factual, and actionable 8th point:
8. Education and skills development
Budget 2026 continues to prioritise education and skills development:
- R450 billion allocated to schools and higher education over the medium term.
- Increased funding for teacher training, technical colleges, and vocational programs.
- Scholarships and bursaries expanded for disadvantaged students in key sectors like STEM and healthcare.
These investments aim to equip South Africans with skills needed for the modern economy, reduce unemployment, and support long-term growth.
Conclusion:
Budget 2026 strikes a balance between fiscal discipline, economic growth, and social protection. With tax relief, social grant increases, and strategic investments, it provides tangible benefits for households, businesses, and the broader economy.
“This Budget is a step towards building a fairer, more prosperous South Africa for all,” Godongwana concluded.
