South Africa will use extra tax revenues for the 2006/07 fiscal year, and a larger budget surplus, to cut debt and reduce government bond issuance, the Treasury said.
Finance Minister Trevor Manuel announced on Saturday strong economic growth and more efficient revenue collection had boosted the tax take to R494-billion, exceeding the R489,7-billion forecast in the Budget in February, which itself was R29-billion over original estimates.
The overrun would help widen the country's first budget surplus to about 0,6% of gross domestic product from an earlier forecast of 0,3%.
Government spending was seen slightly lower than predicted at R468-billion for the year to the end of March.
Manuel told the Business Report newspaper the surplus would be used to pay off debt rather than handed to government departments, many of which have been unable to spend their full allocations.
"We are not going to allocate it now. We don't want to create any sense of looseness ... that's not the route we want to take," he said in an interview.
full story from M&G here