The R56.8bn shortfall ( in government revenue reported in the 2023 medium-term budget policy statement (MTBPS) came as no surprise to observers of the monthly tax returns. It represented a moderate miss in volatile circumstances — equivalent to 3.1% of the revenue expected in the February 2023 budget of R1.788-trillion.

That revenue is a very large number, equivalent to 25% of GDP. The real tax burden (taxes/GDP) isn’t expected to change over the next few years. Company tax, lower by R35.8bn, and net revenue from VAT, down R25.6bn, accounted for much of the shortfall. Weaker metal prices and huge investment in alternatives to Eskom power were largely responsible for both declines...

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