Much talk of government austerity, but this budget shows no sign of it
Is our money more useful in the hands of the government, or in the hands of those who produced the income
In this budget speech, Finance Minister Pravin Gordhan raised an important question that must guide the drive for "radical transformation". "What is the relationship", he asked, "between the budget and the transformation … we require in our economy and society?" In other words, can we trust that our society’s resources are best placed in the hands of the government for the outcomes we seek? Having expected that the minister would have no choice but to increase taxes in this budget, it came as no surprise that he did — although with a particular sting for those in the upper income-tax bracket, who will be handing the government as much as 45% of their earnings every year. This, and other tax changes, mean government is taking more and more of our national income, with the promise of ploughing it back for all of our benefit. Government revenue as a percentage of GDP is now at 29.8% and will breach the 30% mark by the end of the current budgeting cycle. That is two percentage points hi...
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