One sweet sentence: Tax proposals will come in February budget speech
Finance minister keeps mum on what's in store for South Africans
Finance minister Enoch Godongwana will not be drawn to discuss what tax proposals the National Treasury has in store for South Africans next year, saying any proposals will only be announced during the budget speech next year.
Godongwana was replying to questions in the National Assembly on Wednesday afternoon.
DA MP Dion George asked the minister what definitive guidance he will provide on potential tax hikes or tax adjustments, including a VAT hike, for the 2024-2025 financial year.
Godongwana took exception to George’s attempts at getting the minister to pre-empt next year’s budget speech, and even said as such in his mother tongue as he began his reply.
“This one is taking chances, but I will answer him with extensive English what I could answer in one sentence,” the minister quipped in isiXhosa.
The minister uses the budget speech to announce government and cabinet fiscal decisions such as expenditure, borrowing and tax measures.
“No prior definitive guidance on which tax instruments will be subject to potential increases can be provided before such processes are undertaken and the budget is tabled before the National Assembly,” he said.
His medium-term budget speech (MTBPS) in November indicated more direct revenue increases will be introduced to fiscal consolidation, he said, adding that the February 21 budget speech will outline the tax proposals.
“Government has proposed only moderate tax revenue measures to raise additional revenue of R15bn in the 2024/2025 financial year. Given the extent of fiscal consolidation required, please don’t ask me where I will get that R15bn — no.”
George thanked Godongwana for delivering an answer that was “more than one sentence”. He asked him about the gold and foreign exchange contingency reserve account and if the National Treasury was considering accessing the R459bn in the account.
“We have not made any statement, even in the MTBPS, to the extent that there are excess reserves. We have not made any statement. We are muted on that point for now,” Godongwana said.
ANC MP Joe Maswanganyi asked Godongwana why the Treasury has not opted for Sars to collect revenue more aggressively from its various sources. The minister said there has been an increased aggressive collection by Sars along with enforcement of compliance.
“In this financial year we have provided Sars with R1bn whose main activity is to achieve that aggressive collection. They have given us a specific target, which I am not at liberty at the moment to disclose.”
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