In the end, it turned out that the 2018 budget was a prisoner of the economic and political conditions created over the past few years. The tepid levels of GDP growth, astounding levels of corruption, declining tax morality and turbulence in the SA Revenue Service (Sars) all combined to create a revenue shortfall that has created fiscal unsustainability. If you recall, back in October when finance minister Malusi Gigaba delivered the medium-term budget policy statement, the revenue shortfall was calculated at R50.8bn — and that did not include the added expenditure needed to fulfil former president Jacob Zuma’s cavalier pledge of free tertiary education. This week’s budget showed that the R50.8bn has been revised down to R48.2bn. To fill this gap, national treasury needs extra tax revenue of R36bn, as well as a commitment to prune government expenditure by R85bn over the next three years. It may be controversial that a one percentage point increase in Vat is the centre of the tax in...

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