One thing we have become depressingly accustomed to in South Africa is that our politicians and government rarely keep their promises. Finance Minister Enoch Godongwana appeared to have hit that on the head in his budget on Wednesday. Leaving aside the expected increases in “sin taxes” on liquor and tobacco – which are frankly morally justifiable as both can cause self-injury – this budget went surprisingly easy for ordinary people. But more than that, Godongwana’s overview of spending and incentives for businesses to get back on their feet after the Covid attacks showed President Cyril Ramaphosa’s state…
One thing we have become depressingly accustomed to in South Africa is that our politicians and government rarely keep their promises.
Finance Minister Enoch Godongwana appeared to have hit that on the head in his budget on Wednesday.
Leaving aside the expected increases in “sin taxes” on liquor and tobacco – which are frankly morally justifiable as both can cause self-injury – this budget went surprisingly easy for ordinary people.
But more than that, Godongwana’s overview of spending and incentives for businesses to get back on their feet after the Covid attack showed that President Cyril Ramaphosa’s State of the Nation Address is put into action.
Ramaphosa annoyed many on the left when he said the government cannot create jobs, but its job is to create conditions that will in turn create jobs. In other words, make it easier for the private sector – and the dreaded capitalism – to make a profit.
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Corporate tax cuts are underway and a corporate bounce back program is underway, including support for small business loans totaling R20 billion.
Another boost to discretionary spending will come from the decision not to raise fuel taxes and to adjust tax brackets to ease individual taxpayers. Teachers should also be relieved by the news that R24 billion will be allocated to improve their salaries.
However, the books are still out of balance and we’ll have to borrow again to fund the deficit, which could basically kick the “bill due” a few years down the line…although there’s a promise to cut that massive national debt.
A decision on e-toll charges was also kicked off the road, which, according to Transport Minister Fikile Mbalula, would be part of the minister’s speech.
Overall, a better-than-expected budget that will hopefully put us on the road to recovery.