TAX POLICY PROPOSALS
Budget quite balanced, and not as radical as SA has seen in the past
Given the tough economic circumstances that we are facing, the budget in general provides a glimmer of hope for all South African, writes Pieter Faber
The finance minister delivered what he referred to as a "tough, but hopeful" budget and we couldn’t agree more. The budget was quite balanced and moderate – definitely not as radical as we’ve seen in the past. In preparation of the budget, the Treasury took into account public comment as well as reports from the Davis tax committee. These are the reasons SA’s budget process was ranked as number one in the world (alongside New Zealand) for transparency and public consultation. While the budget was moderate, as noted, what is of concern is the growing debt levels and debt-servicing costs with no clear plan as to how this will be reduced. A projected debt-to-GDP ratio of 56.2% in 2022-23 (initially estimated at 60%) is a major concern, especially given that it was 41.1% in 2013. The growing debt is not sustainable given the limited options to increase revenue and the slow economic growth rate. We hope to see concrete plans to tackle this in the near future. The tax policy proposals are...
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