Possibility of hike in VAT a major concern of opposition parties

20 February 2018 - 17:12 By Aphiwe Deklerk
subscribe Just R20 for the first month. Support independent journalism by subscribing to our digital news package.
Subscribe now
Malusi Gigaba.
Malusi Gigaba.
Image: Esa Alexander

The possibility of hike in value added tax has been revealed as a major concern of opposition parties and civil society ahead of Finance Minister Malusi Gigaba’s budget speech on Wednesday.

“We need to cut spending and expenditure in the right areas‚” said Lees.

Lees said cuts ought to focus on superfluous government departments‚ "zombie" SOEs‚ and vanity projects such as the New Development Bank.

“If the budget does this‚ we will support it. However‚ if the budget cuts basic services such as health‚ education‚ social grants and infrastructure that facilities growth‚ we will reject it‚” added Lees.

Wayne Duvenage‚ CEO of Organisation Undoing Tax Abuse‚ said it was unlikely that Gigaba would not announce a tax hike.

“It’s going to be quite a painful tax because there is a lot of damage to be undone by the past seven‚ eight years of poor governance and poor leadership‚” he said.

He said he expected tax hikes to affect middle class and the rich‚ including a petrol levy hike.

Corruption Watch executive director‚ David Lewis‚ said this year’s budget will be tightly drawn because of the state of the economy and the state of SARS.

“[Gigaba must] elaborate and follow through on the president’s plan to clean up SARS. One of the greatest constraints that our budget faces is in the decline of the revenue collection‚” said Lewis.


subscribe Just R20 for the first month. Support independent journalism by subscribing to our digital news package.
Subscribe now