State revenue collections could fall more than R20bn short of February’s budget targets for this year, driving up the budget deficit and making it tough for Finance Minister Pravin Gordhan to convince ratings agencies not to downgrade SA’s credit rating. Gordhan is due to table his medium-term budget in Parliament on Wednesday, against a background of weaker than expected economic growth that has put monthly collections of large revenue sources such as personal income tax and value added tax under strain. At the same time, there are pressures to add to spending in areas such as higher education and the ratings agencies have warned a deterioration in fiscal ratios could bring a downgrade. Economists who have been crunching the numbers ahead of next week’s budget say if trends continue, the deficit for the current fiscal year (2016-17) could be as much as 0.5 percentage points higher than Gordhan projected in February. Efficient Group economist Dawie Roodt said this week if revenue co...
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