Mzansi expects pro-poor Budget Speech from minister!

MZANSI is expecting a pro-poor Budget Speech from Finance Minister Enoch Godongwana.

As he takes the podium to table his budget on Wednesday, 19 February, all eyes will be on him to see what he has for them.

According to the African Transformation Movement (ATM), the minister should transform promises made by President Cyril Ramaphosa during the recent State of the Nation Address (Sona) into actionable policies that effectively address multifaceted crises facing the country.

"In the Sona, Ramaphosa outlined ambitious goals centred on infrastructure development, socio-economic growth, and effective governance. However, we assert that the recurring themes of previous addresses must evolve into concrete actions rather than mere rhetoric.

"We expect that the upcoming budget will facilitate the establishment of sustainable frameworks that support these objectives, particularly in areas such as water management and the revitalisation of state-owned enterprises like Transnet, which remains a significant barrier to our economic progress," said ATM spokesman Zama Ntshona.

He said the ATM was particularly concerned about persistent issues of unemployment, poverty, and infrastructure decay that have been inadequately addressed in past budgets.

The South African Communist Party (SACP) stated that it denounces and rejects the budget in advance, if it includes an increase in Value-Added Tax (VAT).

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SACP spokesman Dr Alex Mashilo said reports in the May 2024 election manifesto that they, as alliance partners, endorsed the government to tackling the cost-of-living crisis by prioritising "food security, including through VAT exemption on essential items" and not increase VAT.

"What National Treasury must do is introduce a wealth tax and a more progressive tax approach, focusing on generating revenue from the rich and wealthy to fund development and key priorities amid high rates of inequality that characterise South Africa," Mashilo said.

"This measure is essential for redistributing resources and addressing the deeply entrenched disparities in income and opportunity."

Mashilo said this measure will also ensure the burden of funding public services is more equitably shared, promoting social cohesion and shared economic growth in line with the Freedom Charter's clarion call, "The people shall share in the country's wealth".

"The SACP won't stop at merely rejecting such a budget. We'll embark on a deep-going process of mass mobilisation of the working class against it until victory is achieved and secured," he said.

The South African Federation of Trade Unions (Saftu) warned the working class and the poor to expect yet another anti-worker and anti-poor budget, if the past Medium-Term Budget Policy Statement (MTBPS) is any indication.

"In that case, this budget will deepen budget cuts, undermine public services, and entrench the neoliberal economic agenda that has left millions of South Africans in poverty and unemployment," said Saftu general secretary, Zwelinzima Vavi.

He called on Godongwana to tax the rich, not the poor, introduce an Income Basic Grant of R1 500, end austerity and reject privatisation, among other things.

Evadne Bronkhorst, a senior manager at Forvis Mazars, told Daily Sun she believes there's little room for significantly increasing taxes.

"If you think about it, the greatest source of tax is personal income tax, contributing 38% to the revenue. The revenue gap in employees' taxes has actually widened, indicating that remuneration paid to salaried, employed, and even independent contract workers is not keeping pace with inflation.

"You would expect, with rising prices and based on Sars projections, that recoveries from privately owned enterprises would increase. However, in reality, the revenue gap has widened, which means South African consumers are not receiving adequate pay. They're already struggling," said Bronkhorst.