Significant tax increases are in the pipeline next year as the Treasury grapples with sluggish economic growth, student demands for free education and lower revenue collection. Despite the constraints, the medium-term budget policy statement tabled in Parliament by Finance Minister Pravin Gordhan on Wednesday has allocated a massive R17.6bn more than projected for post-school education and training over three years. This is in addition to the R16bn added in February. The money will be used to subsidise the fee increases for poor households. The policy statement - SA's 20th - has also signalled straitened times for government departments, which will be required to cut back on their spending, particularly on employees. Corporate tax hikes are not feasible in the current globally competitive environment and so a politically unpalatable increase in value-added tax might have to be considered. However, the form the proposed tax increases will take will be announced only when the finance ...

Subscribe now to unlock this article.

Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).

There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.

Cancel anytime.

Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.