ECONOMIC WEEK AHEAD: Malusi Gigaba needs a pot of gold
The finance minister delivers his mini-budget — a roadmap of the government’s spending priorities over the next three years — on Wednesday, writes Asha Speckman
Given that SA’s tax rates are higher than the average for Organisation for Economic Co-operation and Development (OECD) member countries, Finance Minister Malusi Gigaba’s plans for raising further revenue will be key to his medium-term budget policy statement this week. Gigaba will deliver the mini-budget — a roadmap of the government’s spending priorities over the next three years — on Wednesday. The subdued environment, characterised by low economic growth, has constrained his fiscal levers. Economists expect Gigaba to prepare the market for meaningful tax hikes in the February budget, alongside funding and sustainability proposals for failing state-owned companies. First National Bank (FNB) economist Mamello Matikinca predicted that guidance on the implementation of the sugar tax, less fiscal drag relief to prevent inflation and earnings growth pushing taxpayers into higher brackets and a proposed reduction in medical aid tax credits would be a likely outcome of the budget. "A sl...
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